* Weekly jobless benefit claims lowest in two months
* Warm weather helps some retailers in June
* Stocks: Dow up 1.2 pct, S&P up 1 pct, Nasdaq 0.7 pct
* For up-to-the-minute market news see []
(Updates to close)
By Angela Moon
NEW YORK, July 8 (Reuters) - Wall Street rose for a third
straight day on Thursday as investors were encouraged to see
jobless claims fall and a handful of large retailers report
solid sales.
Stocks have regained their footing after a slew of poor
data had raised fears of a double-dip recession. But low market
volume suggested investors are still skeptical, and few expect
to see a sustained rally.
The Dow rose more than 1 percent, bolstered by late-day
buying. Consumer staples <.GSPS> were the S&P's best-performing
sector, with Costco Wholesale Corp <COST.O> rising 2.6 percent
at $55.71. The sector gained 1.5 percent.
"The data we saw today was better than what we are used to
seeing ... it shed a bit of hope," said Steve Goldman, market
strategist at Weeden & Co in Greenwich, Connecticut.
"But there is still so much bearishness in the market that
it is causing stocks to swing in such a swift manner."
The Dow Jones industrial average <> was up 120.71
points, or 1.20 percent, at 10,138.99. The Standard & Poor's
500 Index <.SPX> was up 9.98 points, or 0.94 percent, at
1,070.25. The Nasdaq Composite Index <> was up 15.93
points, or 0.74 percent, at 2,175.40.
Teen apparel retailers like Abercrombie & Fitch <ANF.N> and
department store chains like JC Penney Co <JCP.N> topped
expectations in their June sales. JC Penney shares rose 6.7
percent to $23.24 and Abercrombie & Fitch Co jumped 7.8 percent
to $35.45.
But semiconductor shares fell after posting their best
one-day gain in weeks on Wednesday.
"It's a nervous environment, and there is not a whole lot
of confidence in the market for investors to jump in with both
feet," said Scott Marcouiller, senior equity market strategist
at Wells Fargo Advisors in St. Louis.
Micron Technology <MU.O> fell 2.3 percent to $8.69 and the
PHLX semiconductor index <.SOXX> slipped 0.1 percent after
rising more than 5 percent on Wednesday.
Apple <AAPL.O> was down 0.2 percent at $258.09 and Intel
<INTC.O> fell 0.2 percent to $20.10.
Sales at stores open at least a year rose 3.1 percent for
the month, according to company reports, just shy of the 3.2
percent increase that Wall Street predicted.
Even though sales grew, retailers relied heavily on
promotions to win over cautious consumers in June. For details
see [].
Initial claims for state unemployment benefits dropped
21,000 to a seasonally adjusted 454,000 in the week ended July
3, the lowest level since early May, the Labor Department
said.
(Reporting by Angela Moon, Editing by Kenneth Barry)
