US STOCKS-Results, jobs data buoy Wall St, S&P eyes 2,000

Thu Jul 24, 2014 3:54pm BST

* Jobless claims lowest since 2006; home sales tumble

* Facebook market cap near McDonald's and UTX combined

* Ford beats expectations; recalls hurt GM

* Indexes: Dow, S&P flat; Nasdaq off 0.1 pct (Updates to morning trading, adds data, comment)

By Rodrigo Campos

NEW YORK, July 24 (Reuters) - The S&P 500 hit a record high for a third straight session on Thursday, lifted by jobs data and earnings, but a weak reading in new home sales kept other key stock indexes little changed.

Stocks had opened higher on strong job market data in the United States and overseas factory readings, while Facebook shares rallied after results beat expectations.

Jobless claims fell to the lowest since mid-February 2006, pointing to continued strength in the labor market, but new home sales fell 8.1 percent in June, the most in almost a year, and May's initial reading of a more than 18 percent gain was revised to just above 8 percent, putting a damper on sentiment as the housing market struggles.

"Housing certainly seems to be the one theme that prevents this economic recovery and earnings story from being a fairly tale, it is the one reminder there are issues," said Peter Kenny, chief market strategist at Clearpool Group in New York.

He said the bullishness behind the strong job numbers was partly offset by market concern that it could translate into a faster route to normalizing monetary policy. However, earnings season is "really quite solid, largely hitting on all cylinders in terms of top and bottom line and revenue growth."

The Dow Jones industrial average rose 7.51 points or 0.04 percent, to 17,094.14, the S&P 500 gained 0.66 points or 0.03 percent, to 1,987.67 and the Nasdaq Composite dropped 4.10 points or 0.09 percent, to 4,469.60.

At its session high, the S&P was 0.5 percent away from hitting 2,000.

Facebook was the poster child for strong earnings following a better-than-forecast 61 percent increase in revenue during the second quarter. Shares jumped 5.6 percent to $75.30, giving the social media giant a market capitalization of $193 billion, roughly the sum of Dow components McDonald's and UTX.

Sports apparel manufacturer and retailer Under Armour jumped 10.5 percent to $67 after quarterly revenue rose by more than a third.

On the flip side D.R. Horton, the No.1 U.S. homebuilder, fell 8 percent to $22.77 after it reported a 23 percent slump in third-quarter profit.

The housing data also hurt homebuilders, with a sector index down 1.6 percent.

Ford shares rose 1.4 percent to $18.03 after profit beat expectations while GM dropped 4 percent to $35.87 on a lower second-quarter profit due to numerous recalls and the expected cost of at least $400 million for its victims' compensation fund.

Drugmakers Bristol-Myers Squibb and Eli Lilly both beat Wall Street expectations, helped by cost controls. Bristol shares edged up 0.4 percent to $49.54 and Eli Lilly dipped 0.3 percent to $64.03.

Markets earlier got support from an expansion in China's factory activity and the euro zone's private sector. (Additional reporting by Chuck Mikolajczak; Editing by Bernadette Baum)

 
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