(Bloomberg) -- U.S. stocks rose, halting a three- day drop in the Standard & Poor’s 500 Index, after a report showed applications for unemployment benefits fell to the lowest level in almost two months.
Johnson Controls Inc., the largest U.S. auto-parts maker, climbed 7 percent after increasing a stock-repurchase program by $3 billion. General Motors Co. advanced 2.3 percent after the U.S. Treasury Department said it plans to sell its remaining stake in the company, possibly by year end. Target Corp. lost 4.1 percent after earnings declined as U.S. consumers curtailed spending.
The S&P 500 increased 0.5 percent to 1,789.62 at 10:11 a.m. in New York. The equity benchmark fell almost 1 percent over the past three days on signs the Federal Reserve may reduce economic stimulus in the coming months. The Dow Jones Industrial Average rose 74.91 points, or 0.5 percent, to 15,975.73 today.
“After three consecutive negative days it’s reasonable to expect a breather at least in the beginning of the day,” Lawrence Creatura, a Rochester, New York-based fund manager at Federated Investors Inc., which oversees about $364 billion, said in a phone interview. “There is some good news in the labor report too in that it does indicate a degree of improvement.”
The S&P 500 has rallied 25 percent in 2013, poised for its best year in a decade, following stimulus from the Fed and better-than-estimated earnings. The gauge traded for about 17 times its companies’ reported earnings at its last record on Nov. 15, the highest valuation since May 2010.
U.S. jobless claims in the week ended Nov. 16 dropped by 21,000 to 323,000, the fewest since the week ended Sept. 28, from a revised 344,000 the previous week, the Labor Department said today in Washington. The median forecast of 47 economists surveyed by Bloomberg called for a drop to 335,000.
GM advanced 2.3 percent to $38.55. The Treasury said it plans to sell its 31.1 million common shares in the company, as soon as year end depending on market conditions and trading volumes.
Johnson Controls climbed 7 percent to $51.58. The auto- parts and building-controls company raised its quarterly dividend by 16 percent to 22 cents per share.
Green Mountain Coffee Roasters Inc. jumped 15 percent to $71.08. Fourth-quarter net income increased 38 percent to $127 million, or 83 cents a share, from $91.9 million, or 58 cents, a year earlier, the company said yesterday. Excluding some items, profit was 89 cents a share. Analysts estimated 75 cents, on average.
Target dropped 4.1 percent to $63.80. The second-largest U.S. discount retailer said third-quarter profit fell 46 percent as U.S. consumers facing higher taxes and unsteady employment curtailed spending. Net income in the quarter ended Nov. 2 slid to $341 million, or 54 cents a share, from $637 million, or 96 cents, a year earlier.
Dollar Tree Inc. fell 5.5 percent to $55.66. The retailer reported third-quarter profit that fell short of analysts’ estimates and lowered the top end its full-year revenue forecast.