Stocks dip early after 5 days of gains; jobless claims rise for second straight week

Stocks drop early; jobless claims rise again

NEW YORK — Stock mostly fell in early trading Thursday after a report showed initial claims for unemployment benefits rose unexpectedly for the second straight week.

Data on industrial production also fell short of expectations, but did show growth for the ninth straight month.

Any disappointment over those reports is being somewhat tempered by a strong regional manufacturing report and an upbeat earnings outlook from UPS Inc.

Stocks pulled back after five straight days of gains pushed the Dow Jones industrial average above 11,000 and the Standard & Poor’s 500 index above 1,200 for the first time in 18 months.

Overseas markets were mixed.

Investors received a second straight week of disappointing jobs data. The Labor Department said first-time requests for jobless benefits rose by 24,000 to a seasonally adjusted 484,000 last week, the highest level since late February. Economists polled by Thomson Reuters, on average, forecast a drop to 440,000.

High unemployment is considered a key stumbling block to a strong, sustained economic recovery.

In early morning trading, the Dow fell 15.95, or 0.1 percent, to 11,107.16. The S&P 500 dropped 0.84, or 0.1 percent, to 1,209.81, while the Nasdaq composite index rose 1.67, or 0.1 percent, to 2,506.53.

The Federal Reserve said industrial production rose 0.1 percent in March. Despite the continued growth, it fell short of analysts’ expectations. Economists predicted production at the nations’ factories, mines and utilities would rise 0.7 percent in March.

Somewhat offsetting the weaker-than-expected economic reports was an upbeat outlook from UPS. The world’s largest shipping company said it expects to report a better-than-expect first quarter profit and raised its full-year earnings guidance.

Because of its position shipping goods, UPS’s results are considered a good indicator for increased economic activity.

A regional report on manufacturing was also stronger than expected, providing further evidence that sector is continuing its recovery. The Empire State manufacturing index jumped to 31.86 in April from 22.86 last month. Economists had forecast it would rise to 24.

Unlike the jobs or housing market, the manufacturing sector has shown steady, consistent growth as the economy emerges from recession.

Economists expect industrial production at the nation’s factories, mines and utilities rose 0.3 percent in March. It would mark the ninth straight month of growth.

Stocks rose sharply Wednesday after strong economic and earnings reports. The Dow rose 104 points.

JPMorgan Chase & Co. and Intel Corp. both reported better-than-expected earnings and provided upbeat outlooks for the economy.

The Commerce Department said retail sales jumped 1.6 percent in March, the third straight month of gains. The growth topped economists’ forecasts. The Federal Reserve’s beige book report on regional economic activity showed a recovery is taking hold in most parts of the country.