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NEW YORK: Wall Street stocks drifted higher on Wednesday after government data showed a drop in wholesale inventories and rising sales, lifting hopes of economic recovery and improvement in the job market.
The Dow Jones Industrial Average edged up 2.95 points (0.03 percent) to end at 10,567.33, after posting modest gains a day earlier on the one-year anniversary of the start of the market's rebound from its lows last year.
The Nasdaq composite rose 18.27 points (0.78 percent) to 2,358.95 while the broad-market Standard & Poor's 500 index climbed 5.17 points (0.45 percent) to 1,145.61.
Analysts said the market got a lift from a government report which showed wholesale inventories unexpectedly fell, by 0.2 percent, in January. Analysts had expected inventories to rise 0.2 percent.
The report also said that sales by US wholesalers in the first month of 2010 rose 1.3 percent to a seasonally-adjusted 346.7 billion dollars.
"Sales have increased for nine straight months and, given the lean levels of inventories, the report suggests that manufacturers could be forced to increase production to meet demand, which could bode well for the continued improvement in manufacturing and the employment outlook," analysts at Charles Scwab & Co said in a client note.
Wall Street on Tuesday marked the anniversary of the stock market's 12-year low set on March 9, 2009, amid the financial crisis stemming from a home mortgage meltdown.
Since then, the blue-chip Dow index has rallied more than 60 percent.
The market is holding up well since the Dow moved up above the 10,500 level on Friday, said Bob Dickey, a technical analyst at RBC Wealth Management.
"The broader list of stocks has been performing better than the indices, which is a bullish indication," he said.
"Since the bear market low of a year ago, all of the S&P sectors are up significantly, which is typical bull-market action."
Among gainers were Citigroup, up 3.66 percent to 3.96 dollar, amid positive reaction to its planned sale of trust preferred securities of about two billion dollars.
It had soared more than seven percent a day earlier on reports that the government may be ready to sell its 27 percent stake within the next several months.
Other banking stocks also rose, among them JPMorgan Chase, up 1.20 percent to 42.93 dollars and Bank of America, up 1.85 percent to 17.11 dollars.
Insurance giant AIG climbed 10.59 percent to 36.24 dollars on top of an almost 13 percent rise a day earlier amid conflicting reports of increasing investor confidence in the stock and excessive market speculation.
Fertiliser company Terra Industries rose 2.44 percent to 46.95 dollars on reports it favours a bid to be acquired by CF Industries instead of a previous agreement with Norway's Yara. CF Indusries was up 2.90 percent to 103.55 dollars.
The bond market fell. The yield on the 10-year US Treasury bond rose to 3.720 percent from 3.701 percent on Tuesday and that on the 30-year bond rose to 4.689 percent from 4.677 percent. Bond prices and yields move in opposite directions. - AFP/de
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