Stocks rise on good economic news

Industrial orders are up and the fear of inflation is down.
NEW YORK (AP) -- A modest rise in industrial orders and greater-than-expected rise in jobless claims eased Wall Street's inflation fears Thursday, prompting investors to send stocks higher after the week's sharp declines. A bullish profit forecast from General Electric Co. also fueled bargain hunting.
With orders for durable goods -- those made to last more than three years -- rising by just 0.3 percent in February, investors felt that demand was sluggish enough to forestall rising prices. A rise in first-time jobless claims, which were up 3,000 to 324,000 last week, gave further relief to inflation fears, since it would be difficult for companies to raise prices in a weak hiring environment.
Investors were also pleased as General Electric, often considered a barometer for corporate America given its wide array of holdings, raised its first-quarter earnings forecast, citing strong performances across its businesses.
"What we have here is a relief rally," said Peter Cardillo, chief strategist and senior vice president at S.W. Bach & amp; Co. "The market was in a severely oversold condition because of all these inflation fears. But I still think there's a bumpy road ahead for a while."
In late afternoon trading, the Dow Jones industrial average rose 37.02, or 0.4 percent, to 10,493.04.
Broader stock indicators also gained ground. The Standard & amp; Poor's 500 index was up 4.66, or 0.4 percent, at 1,177.19, and the Nasdaq composite index climbed 12.66, or 0.6 percent, to 2,002.88.
Oil prices rebound
After dropping 4 percent earlier in the week, oil prices staged a recovery Friday. A barrel of light crude settled at $54.84, up $1.03, on the New York Mercantile Exchange. The bond market held steady, with the yield on the 10-year Treasury note at 4.6 percent. The dollar rose against world currencies, while gold prices edged lower.
With inflation fears confirmed by the Federal Reserve earlier in the week, Wall Street will be looking out for modest economic data to show that the economy will grow at a slow enough pace to forestall inflation, but at a fast enough pace to bolster corporate earnings reports. First quarter earnings reports will begin coming in during the second week of April.
"If you look at the data, the economy is doing just fine, and we expect that to continue," said Hans Olsen, managing director and chief investment officer at Bingham Legg Advisers. "But you see a market that's been sold off dramatically. The key is interest rates, in that hopefully they will strengthen the dollar without causing too much harm to all the debt that companies and consumers have out there."
GE gained 45 cents to $35.95 on the strength of its outlook and an increase in its full-year earnings forecast. The company also said it has priced the secondary offering of 80.5 million shares of Genworth class A common stock at $26.50 per share. GE will own 52 percent of the outstanding shares after the offering.
Northrop Grumman also raised its earnings-per-share estimates for 2005, crediting its sale of TRW Automotive Holdings Corp. shares. The defense contractor also said its board raised its quarterly cash dividend by 13 percent to 26 cents. Northrop Grumman was up 99 cents at $53.77.
Internet services company Yahoo! Inc. added 68 cents to $31.55 after its board approved a $3 billion stock repurchase program. The buybacks will be spread out over the next five years.
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