Wall St rebounds on strong economic reports

NEW YORK (AP) – Signs that the US economy is improving helped investors put aside fears over Japan’s nuclear crisis Thursday, if only temporarily.

The Dow gained 161.29 points, or 1.4 percent, to 11,774.59. The index fell 242 points Wednesday, its largest drop since August.

The Standard & Poor’s 500 rose 16.84, or 1.3 percent, to 1,273.72. With Thursday’s gains, the Dow and S&P 500 are up more than one percent for the year.

A gauge of manufacturing in the mid-Atlantic region jumped in February to the highest point since January 1984. The survey from the Federal Reserve’s Philadelphia branch showed new orders soared. Production at US factories, mines and utilities dipped last month but was actually higher in previous months than first estimated, according to the Federal Reserve.

The Labor Department reported that the number of people applying for unemployment benefits fell more than economists expected last week. Ongoing claims dropped to the lowest level since October 2008.

“It’s a reminder that the US economy continues to gain momentum,” said Alan Gayle, senior investment strategist at RidgeWorth Investments in Richmond, Virginia. “Economic growth leads to more spending, more production and ultimately rising profits,” he said. “And at the end of the day, that’s what investors buy: rising profits.”

Gains in the stock market were broad. All of the 10 groups rose in the Standard & Poor’s 500 index, the basis for most US mutual funds. Twenty-six of the 30 stocks that make up the Dow Jones industrial average rose, led by a 3.2-percent increase in Hewlett-Packard Co.

The Nasdaq rose 19.23, or 0.7 percent, to 2,636.05. The technology-heavy index is down 0.6 percent for the year.

FedEx Corp. rose three percent. The world’s second-largest delivery company said revenue rose 11 percent in the most recent quarter, mostly due to higher shipping rates. FedEx said those higher rates may help it beat earnings forecasts in the future. United Parcel Service Inc., FedEx’s rival, rose 1.7 percent.