NEW YORK — Investors are growing more confident that the bruised economy is starting to heal.
Stocks closed at their highest level in more than two months Thursday following a mix of earnings and economic reports that indicate the pace of the economy’s slide is slowing.
Nokia led high-tech stocks higher after the world’s top mobile-phone maker said it was maintaining its outlook for the phone market and had surpassed analyst expectations for mobile-phone sales during the first quarter. And JPMorgan Chase & Co. became the latest bank to report first-quarter earnings that were stronger than predicted.
The day’s economic numbers also fed investors’ optimism. The government’s weekly unemployment claims fell more than expected for the second straight week, and a snapshot of regional manufacturing from the Philadelphia Federal Reserve was better than expected.
Home construction fell sharply last month, but analysts said that could help the real estate market work through an oversupply of homes.
Although investors do not yet know how well all of America’s biggest companies fared in the first three months of the year, there is a growing sense that the economy and the market are starting to stabilize. And that allowed Wall Street to build on a more than five-week rally that started on the earliest signs that the worst of the recession might be over.
“Investors are saying Armageddon is off the table, the (Category) 5 hurricane has passed,” said Phil Orlando, chief equity market strategist at Federated Investors in New York.
“They’re starting to price in the end of the recession.”
The Dow Jones industrial average closed up 95.81, or 1.2 percent, at 8,125.43, its first close above 8,100 since Feb. 9. The Dow is now up 24 percent since skidding to a 12-year low on March 9 though the index is still down 42.6 percent from its peak of 14,164.53 in October 2007.
Broad stock indicators rose by bigger percentages. The Standard & Poor’s 500 index rose 13.24, or 1.6 percent, to 865.30. The Nasdaq composite index rose 43.64, or 2.7 percent, to 1,670.44, its highest finish of the year.
The tech-heavy Nasdaq is now up 5.9 percent in 2009. The index lagged the broader market Wednesday when Intel disappointed investors by declining to provide revenue forecasts.
“Things are not necessarily getting better, but they are getting less worse,” said David Stepherson, a portfolio manager at Hardesty Capital Management in Baltimore.
