The Economic Times

22 Dec, 2011, 09.52PM IST, AP

Better job market news sends US stocks higher

NEW YORK: Encouraging economic numbers are sending stocks higher in early trading Thursday. The number of Americans applying for unemployment benefits dropped last week to the lowest level since April 2008, the latest sign that the job market is healing.

The Dow Jones industrial average rose 30 points, or 0.3 per cent, to 12,137 in the first half-hour of trading. The S&P 500 index rose 5 points, 0.4 per cent, to 1,249. The Nasdaq was up 11, or 0.4 per cent, at 2,589.

Applications for unemployment benefits fell 4,000 to 364,000, the Labor Department said Thursday. It was the third straight weekly drop.

The government also lowered its estimate of US economic growth in the July-September quarter to an annual rate of 1.8 per cent from 2 per cent. That was still the fastest growth this year, up from 1.3 per cent in the April-June quarter.

Economists think the improving job market, strong holiday shopping, and cheaper gas prices will leave consumers with more money to spend. That would get the economy growing at an annual rate of more than 3 per cent in the final three months of this year, which would be the fastest pace since 3.8 per cent growth in the spring of 2010.