Stocks rise after inventories fall but sales gain

Investors are searching for direction after two days of relatively flat trading and traders are looking for signs of sustained economic growth.

The Associated Press

3/10/2010

NEW YORK — Stocks are edging higher after the government said businesses trimmed their inventories again in January.

The Commerce Department says Wednesday that wholesale inventories fell 0.2 percent in January following a 1 percent drop in December. Sales rose 1.3 percent, however. That's the 10th straight gain.

If sales pick up, that would likely force businesses to restock inventories.

Investors are searching for direction after two days of relatively flat trading and traders are looking for signs of sustained economic growth.

Consistent growth in business inventories means a positive trend for manufacturers who could increase staff to keep up with additional demand. Growth in consumer spending and jobs creation are considered keys to creating sustained economic growth.

In early morning trading, the Dow Jones industrial average rose 11.42, or 0.1 percent, to 10,575.80. The Standard & Poor's 500 index rose 2.10, or 0.2 percent, to 1,142.54, while the Nasdaq composite index rose 5.11, or 0.2 percent, at 2,345.79.

Major indexes all rose modestly on the one-year anniversary of the market hitting a 12-year bottom. The Nasdaq composite index reached an 18-month high Tuesday, but is still down by more than half from its all-time high hit 10 years ago Wednesday at the peak of the dot-com bubble.

Financial stocks helped boost the market Tuesday, like they did frequently during the past year. Bank shares rallied on rumors the government might prohibit the trades known as short sales in stocks of companies it owns. The government still has large stakes in bailed-out companies, including Citigroup Inc., American International Group Inc. and mortgage giants Fannie Mae and Freddie Mac.

Kevin Jones of The Trucker staff may be contacted to comment at kevinj@thetrucker.com.