Stocks rose Thursday as oil prices took a break from their record-breaking run higher.
Also, data on jobless claims eased recession fears, and Ford (F) warned of rough times ahead.
On the NYMEX Thursday morning, crude oil for July delivery was down 73 cents at $132.44 per barrel, after rising more than $4 on Wednesday and pushing above $135 overnight
Technical strategist Mark Arbeter of Standard & Poor's said oil is approaching at least a short-term peak. "However, if crude continues to power ahead for too much longer, we believe its effect on stock prices will not be positive," he said.
Stocks suffered from oil's surge on Wednesday but were rebounding Thursday. Late Thursday morning, the Dow Jones industrial average was up 37.46 points, or 0.3%, to 12,638.65, after tumbling 227.49 points on Wednesday. The broader S&P 500 index was up 5.12 points, or 0.37%, to 1,395.83. The tech-heavy Nasdaq composite index gained 15.9 points, or 0.65%, to 2,464.17.
U.S. jobless claims fell 9,000 last week to 365,000. "The data continue to contradict notions of a recession, as well as the [Federal Reserve's] fear that the unemployment rate will soar higher this year," Action Economics says.
Ford no longer expects to be profitable in 2009, which was the troubled automakers' previous goal. The firm said it will cut production further this quarter, by 20,000 vehicles, and plans to cut output by 15% to 20% in the third quarter.
Among stocks in the news Thursday, UBS (UBS) will raise $15.5 billion in new capital, but only by selling new shares at a 31% discount.
Sallie Mae Corp. (SLM) plans to continue making federally guaranteed student loans, the Wall Street Journal says. There were concerns the credit crisis would drive Sallie Mae from the market.
Limited Brands (LTD) posted better-than-expected earnings of 11 cents per share, vs. 13 cents a year ago, as same-store sales fell 8% and revenue dropped 16%. The firm expects second quarter earnings of 16 to 20 cents per share.
Computer Sciences Corp. (CSC) reported earnings of $1.15 per share, vs. $1.44 a year ago, even as revenue rose 11%.
AnnTaylor Stores Corp. (ANN) posted earnings of 43 cents per share, vs. 46 cents a year ago, as same-store sales dropped 4.3%.
Suntech Power Holdings Co. (STP) reported earnings of 33 cents per share, vs. 16 cents a year ago, as revenue rose 76%.
Pfizer (PFE) is facing concerns about is smoking-cessation medicine Chantix. A nonprofit drug safety group is warning of serious side effects, the Wall Street Journal says.
Major European indexes were mixed Thursday. In London, the FTSE 100 index edged up 0.15% to 6,207.10. Paris' CAC 40 index up just 0.01% to 5,027.81, and Germany's DAX index moved 0.37% higher to 7,067.05.
In Asia, Japan's Nikkei 225 gained 0.37% to 13,978.46, while Hong Kong's Hang Seng index lost 1.64% to 25,043.12.
Treasury market
Bond prices were lower Thursday. Two-year Treasury notes were off 04/32 to 99-11/32 for a yield of 2.483%; the 10-year Treasury fell 13/32 to 100-07/32 for a yield of 3.854%; and the 30-year lost 12/32 to 96-31/32 for a yield of 4.567%.