YAHOO [BRIEFING.COM]: Strength among financial stocks and a couple of positive pieces of data helped the broader market overcome an early fit of weakness that stemmed from a disappointing jobless claims report. In turn, stocks logged their third straight session of gains and are now up modestly week-to-date.

News that initial jobless claims for the week ending August 15 came in above expectations at 576,000 and continuing claims made a slight advance to 6.24 million in the face of expiring unemployment benefits undercut a positive bias in premarket trading. However, stocks were able to shake off the news of stubbornly weak labor markets and managed to make their way higher in the first few minutes of trade.

The initial advance was particularly kind to the financial sector, which gained momentum as bank stocks and insurers garnered additional support. Diversified banks finished 3.0% higher and multiline insurers closed with a 4.3% gain. The broader financial sector finished 2.6% higher, which was more than double the gain had by the next best performing sector (industrials, +1.2%).

The mood among participants improved further following midmorning news that leading economic indicators increased 0.7% in July. Though that was generally in-line with expectations, it marked the fourth straight increase.

A surprise increase in the Philadelphia Fed Index also proved pleasing. The index for August came in at 4.2, which was up from -7.5 in July and bested the -0.2 that was widely expected.

Gains by the financial sector, along with an upbeat Philly Fed Index and leading indicators report, helped drive all 10 major sectors to finish with gains.

The improved tone among broader market participants even helped lift retailers, which were hampered by weakness in shares of Sears Holdings (SHLD 65.00, -8.76) after the company reported a worse-than-expected loss. Weakness was shared by Buckle (BKE 26.84, -1.09) and Limited (LTD 14.35, -0.23), even though both companies posted better-than-expected quarterly earnings. Still, retailers were able to finish 0.4% higher.

Trading volume remains low. Though 1 billion shares exchanged hands in the NYSE for the first time since Monday, that's still well below longer-term averages. The lack of participation in recent sessions brings into question the legitimacy of the stock market's three-session run, which now totals nearly 3%.DJ30 +70.89 NASDAQ +19.98 NQ100 +1.1% R2K +1.3% SP400 +1.1% SP500 +10.91 NASDAQ Adv/Vol/Dec 1733/1.98 bln/904 NYSE Adv/Vol/Dec 2221/1.05 bln/811