US stocks gain on hopes of Fed action

by **hlk** Sun 09 Sep 2012, 16:27

NEW YORK: US stock markets turned a weak jobs report into positive news
Friday, ending higher on expectations that the data will lead to new
Federal Reserve efforts to help the economy.

The markets added to Thursday's strong gains, with big mining companies surging on a jump in gold prices.

The Dow Jones Industrial Average closed up 14.64 points (0.11 percent) at 13,306.64.

The SandP 500 gained 5.80 (0.40 percent) at 1,437.92, while the tech-rich Nasdaq edged up 0.61 point (0.02 percent) to 3,136.42.

The
Labor Department's report that a meager 96,000 jobs were added last
month, and that 368,000 people dropped out of the jobs market,
convinced many that the Fed would have to act to boost growth in its
policy meeting next week.

"Hopes for additional Fed stimulus
measures were raised after employment growth remained weak in August,"
Wells Fargo Advisors analysts said.

On the Dow, blue chips Alcoa
and Caterpillar both jumped 3.9 percent, while Kraft disappointed
investors, falling 5.5 percent as it unveiled a new marketing strategy
ahead of splitting its US grocery arm from its international snacks
business.

Mining stocks led the way as gold prices surged on the
prospect of falling interest rates on both sides of the Atlantic and
commodities giant Glencore jacked up its bid for mining group Xstrata.

Freeport
McMoran leaped 8.5 percent and Southern Copper 5.3 percent. US-traded
shares of Xstrata surged 5.3 percent, and those of Vale jumped 6.75
percent.

Financials continued their Thursday gains helped by the
prospect of lower interest rates. Bank of America rose 5.4 percent,
Citigroup 3.1 percent, Goldman Sachs 2.5 percent and JPMorgan Chase 1.6
percent.

On the Nasdaq, Intel shares lost 3.6 percent after it
cut its sales outlook for the third quarter and said it would revise
its full-year forecast, citing weaker-than-expected demand.

Following suit, chip maker AMD lost 5.7 percent and Micron Technology lost 3.8 percent.

Pandora
Media plunged 16.7 percent after the Wall Street Journal reported that
Apple is in talks to license music for broadcast on a custom online
radio. -- AFP