Stocks rise on reports of GM bondholder agreement Stocks open higher on reports of GM bondholder deal; drop in new jobless claims boosts mood
- Madlen Read, AP Business Writer - On Thursday May 28, 2009, 9:59 am EDT - Buzz up! - Print <Stocks-rise-on-reports-of-GM-apf-15369626.html/print> Related: - Costco Wholesale Corporation </q/h?s=cost> - , General Motors Corporation </q/h?s=gm> - , Time Warner Inc. </q/h?s=twx> NEW YORK (AP) -- Stocks are sharply higher amid reports that a General Motors Corp. bondholders committee accepted an amended debt offer. Related Quotes Symbol Price Change COST <http://finance.yahoo.com/q?s=COST> 47.83 -1.00 [image: Chart for Costco Wholesale Corporation] <http://finance.yahoo.com/q?s=COST> GM <http://finance.yahoo.com/q?s=GM> 1.30 +0.15 [image: Chart for GEN MOTORS] <http://finance.yahoo.com/q?s=GM> TWX <http://finance.yahoo.com/q?s=TWX> 23.40 +0.40 [image: Chart for TIME WARNER INC NEW] <http://finance.yahoo.com/q?s=TWX> {"s" : "cost,gm,twx","k" : "c10,l10,p20,t10","o" : "","j" : ""} Trading in GM shares is halted. CNBC is reporting that bondholders would get 10 percent of the equity in the company. That might still not spare the company from bankruptcy, however. Stocks are higher after tumbling Wednesday on worries about rising borrowing costs. Wall Street is also advancing as readings on jobless claims and big-ticket manufactured goods suggest the economy is stabilizing. In the first minutes of trading, the Dow Jones industrial average is up 65 at 8,361. The Standard & Poor's 500 index is up 7 at 900, while the Nasdaq composite index is up 15 at 1,747. THIS IS A BREAKING NEWS UPDATE. Check back soon for further information. AP's earlier story is below. NEW YORK (AP) -- Wall Street is headed for a higher open Thursday after readings on jobless claims and durable goods suggested the economy is stabilizing. Orders for durable goods rose by more than expected, while initial jobless claims came in lower than analysts predicted. Still, stock futures gained only modestly. The job market is far from healthy -- the number of people continuing to receive unemployment benefits rose to a new record. Investors were also disappointed by an outlook issued by consumer products maker Procter & Gamble, and hesitant ahead of new home sales data scheduled for 10 a.m. Eastern time. "We still have headwinds ahead, in terms of the housing market going down," said Michael Sheldon, chief market strategist at RDM Financial Group. "And we don't know how high the unemployment rate is going to peak. But for now, investors continue to focus on the positives." Economists surveyed by Thomson Reuters forecast that sales of new homes rose in April for the second straight month. Before the market's open, Dow Jones industrial average futures rose 18, or 0.2 percent, to 8,315. Standard & Poor's 500 index futures rose 3.10, or 0.4 percent, to 895.50. Nasdaq 100 index futures rose 0.25, or less than 0.1 percent, to 1,404.25. The Commerce Department said Thursday that April orders for big-ticket items rose 1.9 percent, more than economists predicted and a reversal from a drop in March. The Labor Department, meanwhile, said new jobless claims fell to 623,000 last week, below expectations, from a revised 636,000 the previous week. Continuing claims hit 6.78 million, the most on records going back to 1967 and the 17th straight record week. Government bonds saw buying pick up in early trading. The yield on the benchmark 10-year Treasury note, which moves opposite its price, pulled back to 3.68 percent from 3.75 percent late Wednesday. The 10-year yield has been hitting six-month highs. While many investors are betting the economy will rebound later this year, companies across various industries are still hurting. P&G officials told analysts in New York that they project earnings per share in a range of $3.65 to $3.80 for the fiscal year that begins July 1. The discount retailer Costco Wholesale Corp. said its most recent quarterly profit sank 29 percent, due partly to lower sales of big-ticket discretionary items. Costco shares slipped in premarket trading. Auto parts supplier Visteon Corp. said it has filed for Chapter 11 bankruptcy protection. The news followed Wednesday's announcement from General Motors Corp. that a debt exchange offer failed, making bankruptcy appear almost certain for the automaker. In other corporate news, Time Warner Inc. announced it will spin off AOL from Time Warner into a separate, publicly traded company. The move was widely expected. The dollar was mixed against other major currencies. Gold prices fell. Light, sweet crude rose 6 cents to $63.51 a barrel on the New York Mercantile Exchange. Overseas, Japan's Nikkei stock average edged up 0.1 percent. In afternoon trading, Britain's FTSE 100 fell 1.2 percent, Germany's DAX index fell 1.2 percent, and France's CAC-40 fell 1 percent.
