NEW YORK — The stock market notched its second straight daily advance Thursday, with investors assuaged by a pullback in oil prices and some better-than-expected economic data.
Wall Street has been worried about cash-strapped consumers paring back their spending, so it was pleased that the energy markets gave up early gains that briefly drove crude oil above $125 a barrel.
In other positive signs, the Philadelphia Federal Reserve said regional manufacturing activity is contracting in May at a much slower pace than in April, while major companies such as General Electric and CBS were making deals.
“The encouraging news is that the markets have become more functional, and large companies are able to make strategic purchases and sales, which previously was a very difficult thing to do,” said Alan Gayle, senior investment strategist for RidgeWorth Capital Management.
But he added, “The market is still trying to digest the severity of the slowdown.”
Fears of an ongoing credit- market paralysis have eased significantly. Federal Reserve Chairman Ben Bernanke said in a speech in Chicago he is “encouraged” by recent efforts by banks to raise cash — a trend that is helping to relieve the credit crisis.
But, Gayle said, “what we’re left with now are cyclical credit strains. And those are likely to linger for a while.”
The Dow Jones industrial average rose 94.28, or 0.73 percent, to 12,992.66.
Broader stock indicators advanced more than 1 percent to their highest closing levels since Jan. 3. The Standard & Poor’s 500 index rose 14.91, or 1.06 percent, to 1,423.57, and the Nasdaq composite index rose 37.03, or 1.48 percent, to 2,533.73.
The technology-laden Nasdaq got a boost from Intel, which rose $1.13, or 4.7 percent, to $24.97 after a Lehman Brothers analyst lifted his price target on the chipmaker, citing strong product demand.
CBS agreed to buy online technology news and entertainment company CNet Networks. for about $1.75 billion. GE plans to auction off its Louisville, Ky.-based appliances business, according to The Wall Street Journal.
But as companies find the corporate climate more operational, a separate concern remains: whether higher food and energy prices are hampering Americans’ ability to spend. Jim Herrick, manager of equity trading at Baird & Co., said oil’s retreat Thursday helped boost the stock market but that the cost of energy remains a concern.
