After seeing some volatility in the previous session, stocks moved mostly higher throughout much of the trading session on Thursday, ultimately closing firmly in positive territory. The strength initially came as investors responded well to the latest economic news and was extended on comments from Treasury Secretary Geithner and a pleasing seven-year note auction.
In economic news, the Labor Department released its most recent weekly jobless claims report, showing that initial claims rose to 652,000 from the previous week's revised figure of 644,000. Economists had expected jobless claims to rise to 650,000 from the 646,000 originally reported for the previous week.
While the jobless claims data indicates continued weakness in the labor market, it suggests that the employment situation is stabilizing rather than showing a continued deterioration.
In other news, Treasury Secretary Tim Geithner called for a stronger regulatory system with increased government power during his testimony before the House Financial Services Committee.
Stocks saw some further upside in the afternoon, as the results of the Treasury Department's auction of $24 billion worth of seven-year notes helped to ease some of the recent concerns about the outlook for demand for government debt.
The major averages continued to perform well going into the close, ending the session at their best closing levels in well over a month. The Dow closed up 174.75 points or 2.3 percent at 7,924.56, the Nasdaq closed up 58.05 points or 3.8 percent at 1,587.00 and the S&P 500 closed up 18.98 points or 2.3 percent at 832.86.
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