Wall Street Rises on Productivity data, Cisco

NEW YORK - U.S. stocks gained sharply on Thursday after an expansion in business productivity and a fall in jobless claims boosted investor confidence about the economy, while Cisco led gains in tech shares.

Upbeat results from Cisco Systems and a rise in retailers' October same-store sales also boosted equity futures.

U.S. non-farm productivity in the third quarter rose at its fastest pace in six years as companies squeezed more output from a smaller pool of labor, while the number of U.S. workers filing new jobless insurance claims fell more than expected last week to a 10-month low.

"The most important data point is productivity, where there was a substantial jump," said Peter Kenny, managing director at Knight Equity Markets in Jersey City, New Jersey. He said the jobs number was roughly in line and indicated a weekly trend of declines in filings.

U.S. retail chains reported October sales slightly ahead of expectations as consumers' austerity eased before the holiday season.

The sales data kicked off with Costco Wholesale Corp (COST) posting a better-than-expected 5 percent increase in October sales.

"Retail sales will be a big thing today because that's the data point that speaks to consumer spending and confidence," Kenny said.

The Dow Jones industrial average gained 172.76 points, or 1.76 percent, to 9,974.90. The Standard & Poor's 500 Index advanced 15.95 points, or 1.52 percent, to 1,062.45. The Nasdaq Composite Index rose 44.18 points, or 2.15 percent, to 2,099.70.

Technology bellwether Cisco Systems Inc (CSCO) said Wednesday that quarterly revenue rose more than expected, and its board authorized up to $10 billion in stock buybacks. Cisco shares rose 3.6 percent to $24.14 in premarket trading.

« PREVIOUSNEXT »