Stocks are Higher on Improved Jobs and Housing Data

Published on Thursday, 02 September 2010 13:04 Written by Christopher Lynn

New York, September 2^nd (TradersHuddle.com) – Stocks are posting modest gains after economic data tempered economic slowdown concerns, ahead of the key jobs report schedule to be release tomorrow.

The Labor Department reported that initial claims for unemployment fell 6,000 to 472,000 last week. The drop was better than the 475,000 claims that were widely expected. Additionally, housing news were also better than expected as pending home sales for July jumped a surprising 5.2%, according to The National Association of Realtors. Economists had forecasted a 1.0% drop.

The housing data and lower weekly jobless claims, spurred investors to bid home improvement retailer, Home Depot (NYSE:HD), as it gained more than 2.3% leading the Dow Jones Industrial Average.

Consumer discretionary, industrials and technology are among the best performing sectors in the S&P 500.

In M&A news, Dell (NASDAQ:DELL) bowed out of its bidding war with Hewlett-Packard (NYSE:HPQ) for utility storage company 3Par (NYSE:PAR), after the largest PC maker in the world increased its bid for the company to $33 per share, topping a previous raised bid from Dell for $32 per share.

Burger King (NYSE:BKC), the hamburger fast food chain, surged more than 24%, as it confirm reports that it will be acquired by 3G Capital for $24 per share or $3.26 billion. Wendy’s Arby’s Group (NYSE:WEN), jumped more than 6%, as investors speculate the fast food chain will also be a candidate for a private equity deal.

On the energy sector, reports of a fire in an oilrig platform in the Gulf of Mexico owned by Mariner Energy (NYSE:ME), send shares plunging on initial news more than 16%, before recovering after initial reports showed that it was not an explosion but a fire and that all employees have been accounted for and no oil had spill as it was on an inactive well. Apache (NYSE:APA), who had agreed to acquire Mariner, also saw increased volatility.

During the day, major national retailers reported same-store sales, with Nordstrom (NYSE:JWN), the upscale department store retailer, jumping more than 7% after the department store operator reported August sales climbed 6.3%, beating analysts expectations. On the same line, Limited Brands (NYSE:LTD), the operator of specialty stores like Victoria Secret and Bath and Body Works, also surged more than 5% on better than expected same store sales in August.