Stocks rise as service industry activity improves

NEW YORK (AP) - Stocks rose Monday as a trade group said the nation's service industry grew last month for the first time in a year.

The Institute for Supply Management said its service index rose to 50.9 in September from 48.4 in August. Analysts polled by Thomson Reuters had expected a reading of 50, the dividing line between growth and contraction.

The index tracks more than 80 percent of the country's economic activity and hasn't grown since August 2008.

A measure of prices paid fell to 48.8 from 63.1 in August. That signals companies could be having a harder time holding prices in place as consumers struggle.

The report follows a two-week slide in stocks that came as data on areas like manufacturing and consumer sentiment fell short of expectations. Stocks have fallen in seven of the past eight days.

In midmorning trading, the Dow Jones industrial average rose 27.21, or 0.3 percent, to 9,514.88.

The broader Standard & Poor's 500 index rose 5.77, or 0.6 percent, to 1,030.98, and the Nasdaq composite index rose 8.92, or 0.4 percent, to 2,057.03.