Stocks rose sharply early Thursday on new signs of economic growth worldwide.
A government report showing initial claims for unemployment benefits fell last week added to the market’s enthusiasm following upbeat manufacturing reports overseas.
International markets rose after new reports showed growth in manufacturing in China and the 16-country bloc that uses the euro. A separate report showed companies in Japan are more confident about the business climate.
Manufacturing will be in focus once the U.S. markets open as well.
A fresh reading of the Institute for Supply Management’s manufacturing index is expected to show the sector expanded for the eighth straight month after 18 months of contraction.
Economists polled by Thomson Reuters predict the ISM’s index rose to 57 in March from 56.5 a month earlier. A reading above 50 indicates growth.
The manufacturing sector has shown some of the most consistent, steady growth since the country began to emerge from recession, unlike the housing and jobs markets that have been more uneven.
The report is due out at 10 a.m. EDT.
In early morning trading, the Dow Jones industrial average rose 79.13, or 0.7 percent, to 10,935.76. The Standard & Poor’s 500 index rose 10.45, or 0.9 percent, to 1,179.88, while the Nasdaq composite index rose 21.20, or 0.9 percent, to 2,419.16.
Stocks got a boost from a Labor Department report showing initial jobless claims fell 6,000 to a seasonally adjusted 439,000 last week. Economists had forecast claims would drop to 440,000.
The weekly report provides some reassurances a day after a payroll company’s report on jobs unexpectedly said employers cut private-sector jobs last month. The government’s monthly report on employment is scheduled to be released Friday.
Stocks are trying to rebound after a disappointing end to an otherwise strong first quarter. Major indexes retreated Wednesday after payroll company ADP said private-sector employers cut 23,000 jobs in March.
Economists had predicted ADP’s jobs report would show 40,000 jobs were added to payrolls last month.
The Dow dropped 0.5 percent, while the S&P 500 fell 0.3 percent.
The ADP report is often used as an early indicator of the Labor Department’s employment report, which will be released Friday. However, there can be wide variations because ADP only accounts for private-sector jobs.
Economists predict the Labor Department will say employers added 190,000 jobs last month, which would be only the second month of jobs growth since the recession began.
The declines Wednesday slightly dampened a very strong first quarter. Stocks have consistently climbed in recent months as investors become more confident the economy is improving, though the growth is slow.
The Dow gained 4.1 percent for the quarter, its best first-quarter performance since 1999. Small, daily gains replaced the big triple-digit moves that defined the market’s rally throughout much of 2009 as major indexes hit 12-year lows in March of that year.
The S&P 500 jumped 4.9 percent during the first quarter.
Source: The Associated Press.