Stocks bounce around as caution again raises head

NEW YORK -- Stocks zigzagged in light trading Thursday following a Philadelphia Federal Reserve report that regional manufacturing conditions weakened more than expected.

Stocks have surged this week on upbeat earnings reports and forecasts so the market's pause isn't surprising.

Stocks mostly rose early Thursday as an unexpected drop in new jobless claims and strong earnings from JPMorgan Chase.

The Labor Department said new claims for unemployment insurance plunged last week by 47,000 to 522,000, the lowest level since early January. Economists polled by Thomson Reuters predicted an increase to 575,000.

The improved data, however, may have been affected by the timing of automobile plant shutdowns, analysts said. Eric Thorne, an investment adviser at Bryn Mawr Trust, said the figures were "skewed."

The market had been surging throughout the week on upbeat earnings reports and forecasts, restarting a rally that stalled last month. The positive reports added to beliefs the economy was in better shape than previously thought. Overseas markets were higher.

The strong earnings from the banks has provided fuel to beliefs the economy is rebounding. The results also show that many of the nation's biggest banks have quickly recovered from the collapse of credit markets last fall that led to the failure of Lehman Brothers and near collapse of American International Group.