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Overnight Markets: US stocks rally as jobless claims decline

by Himanshu Singh on Feb 07, 2014 at 02:55

Overnight Markets: US stocks rally as jobless claims decline

Wall Street rallied on Thursday, with the benchmark indexes registering their best gains this year, after a drop in applications for unemployment insurance boosted confidence in the economy and earnings from Walt Disney Co. to Akamai Technologies Inc. surpassed estimates.

The Dow Jones industrial average rose 188 points or 1.22%, to 15,629, the S&P 500 gained 22 points or 1.24%, to 1,773 and the Nasdaq Composite added 46 points or 1.14%, to 4,057.

Initial claims for state unemployment benefits fell 20,000 last week to a seasonally adjusted 331,000, boding well for the jobs market and the overall economy.

The rally came ahead of the widely-followed payrolls report for January due Friday, which some are expecting to be affected by the extreme weather that hit much of the US.

Walt Disney (DIS.N) was the most recent bellwether to beat expectations as its profit topped estimates, sending its shares up 5.3%.

Green Mountain Coffee Roasters (GMCR.O), one of the most shorted stocks on Wall Street, surged 26.2%. Coca-Cola (KO.N) shares rose 1.1% after the company purchased a 10% stake for $1.25 billion and said it would help launch Green Mountain's new cold drink machine. Home beverage device maker SodaStream International (SODA.O) jumped 7.2%.

The Nasdaq received a boost from Akamai Technologies (AKAM.O), which soared 20.6% after forecasting better-than-expected results.

On the negative side, Spirit AeroSystems (SPR.N) shares declined 19.6% after the major supplier of components to Boeing (BA.N) and Airbus (AIR.PA) reported a quarterly loss on charges tied mainly to the Boeing 787 programme.

LinkedIn (LNKD.N) shares fell 8% after the bell following its results and outlook.

In Asia, shares rose on Friday in morning trade after the US jobless claims declined and investors weighed company earnings.

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