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US stocks shrug off jobless data to end higher

US stocks advanced on Thursday, extending the prior day's gains after jobless claims increased but overall the data continued to suggest an improving labour market.

NEW YORK: US stocks advanced on Thursday, extending the prior day's gains after jobless claims increased but overall the data continued to suggest an improving labour market.

The Dow Jones Industrial Average added 61.78 points (0.37 per cent), closing at 16,713.58. The broad-based S&P 500 gained 8.46 points (0.43 per cent) at 1,955.18, while the tech-rich Nasdaq Composite Index rose 18.88 points (0.43 per cent) to 4,453.00.

Traders shrugged off a larger-than-expected rise in initial claims for unemployment insurance benefits last week that did not alter the still-improving trend in the volatile weekly data.

"While the latest reading on initial claims was higher than expected, the four-week average has risen only slightly from the eight-year low reached last week," Dean Maki of Barclays Research said in a client note. "Thus, we still would view the claims data as consistent with a labour market that is improving."

Investors also appeared to view data showing the eurozone's second quarter stall as likely to spur the European Central Bank to step in with more stimulus for the 18-nation bloc.

Health stocks were in favour. On the Dow, Pfizer led the blue-chip index higher, gaining 1.8 per cent, and Merck added 1.6 per cent. 

Dow member Wal-Mart rose 0.5 per cent despite lowering its 2014 earnings per share forecast to US$4.90-US$5.15, from the prior estimate of US$5.10-US$5.45, citing investments in e-commerce and higher US health care costs than previously anticipated.

Cisco Systems was the biggest Dow decliner, falling 2.6 per cent. The computer networking giant reported a 21 per cent fall in fiscal fourth-quarter profit that beat expectations. But its projected adjusted earnings per share of between 51 and 53 cents for the current quarter missed.

Department store chain Kohl's leaped 3.3 per cent after reporting slightly better second-quarter profit and a positive turn for sales in July. Red Robin Gourmet Burgers served up a big 15 per cent drop in fiscal second-quarter profit, saying it was mainly squeezed by higher food and beverage costs. The restaurant chain plunged 18.5 percent.

Shares in US investment star Warren Buffett's Berkshire Hathaway group topped US$200,000 (S$249,238)apiece for the first time, less than eight years after breaking the US$100,000 (S$124,619) barrier. Berkshire A shares, the priciest equity on the market, surged 1.8 per cent to US$202,850.00 (S$252,789).

Bond prices advanced. The yield on the 10-year US Treasury fell to 2.39 per cent from 2.41 per cent on Wednesday, while the 30-year dropped to 3.19 per cent from 3.24 per cent. Bond prices and yields move inversely.