Thursday, May 7, 2009
Investors are hearing some more good news about the economy but are locking in profits anyway following huge gains earlier in the week.
Upbeat reports Thursday on the job market and retail sales initially sent stocks higher but the gains eroded by mid-morning as traders asked "What's next?" Traders are trimming their holdings following the 4.8% gain so far this week in the Standard & Poor's 500 index.
New applications for jobless benefits plunged to the lowest level in 14 weeks, a possible sign that the massive wave of layoffs has peaked. Still, the number of unemployed workers getting benefits climbed to a new record.
And the government says productivity rebounded in the first three months of this year while wage pressures eased, both outcomes reflecting the country's deep recession.
Many retailers are reporting less sharp declines in April as shoppers bought a few more items. Warmer weather and glimmers of hope for the economy helped.