The S&P 500 closed above 1,400 for the first time since the 2008 financial crisis on Thursday as data underscored improvement in the U.S. economy, while crude fell on news Britain and the United States might release strategic oil stocks to keep growth on track.
The number of Americans claiming new jobless benefits last week fell back to a four-year hit last month, the latest evidence the labour market is finally healing, and manufacturing activity in the Northeast picked up this month.
The data came two days after the U.S. Federal Reserve offered a slightly more optimistic view of the economy.
The Standard & Poor's 500 index <.SPX> advanced for the sixth session out of seven, notching its highest close since June 2008.
The data is lifting us today, but so is the momentum of the market, said Rex Macey, chief investment officer at Wilmington Trust in Atlanta, Georgia, which manages about $60 billion.
People are getting more comfortable with the S&P above 1,400 and financials leading, which by itself is indicative of a sigh of relief. The trend is your friend, and lately the trend has been higher.
Graphic - New York manufacturing:
Graphic: Northeast manufacturing: Philly Fed & Empire State
Graphic - U.S. jobless claims http://link.reuters.com/hug27s
The S&P 500 has risen about 11.5 percent so far this year without a major pullback, and while some have called for a consolidation, others see the momentum persisting.
We've had such a strong run that a lot of people are concerned we're up too much, but data has been so positive that I think we'll continue to grind higher, said Hank Herrmann, chief executive of Waddell & Reed Financial Inc in Overland Park, Kansas.
The Dow Jones industrial average <.DJI> and the Nasdaq <.IXIC> also climbed on Thursday.
Financial stocks <.GSPF>, which have dragged lately, led the day with the S&P sector index up 1.9 percent.
Shares of Apple Inc
The Dow Jones industrial average <.DJI> gained 58.66 points, or 0.44 percent, to 13,252.76. The Standard & Poor's 500 Index <.SPX> gained 8.32 points, or 0.60 percent, to 1,402.60. The Nasdaq Composite Index <.IXIC> gained 15.64 points, or 0.51 percent, to 3,056.37.
The U.S. data also helped push European stocks to close near 33-week highs.
The FTSEurofirst 300 index <.FTEU3> of top European shares finished up 0.35 percent at 1,102.17, a day after closing at its highest level since August. The index is up 10 percent this year, almost fully recovered from a drop of 10.7 percent last year.
Brent crude oil futures slumped $4 a barrel after Reuters, citing two British sources, reported that Britain decided to cooperate with the United States in an agreement to release oil from government-controlled strategic reserves. Other countries may also be approached by Washington to contribute, a further source said, Japan among them. A White House spokesman declined comment.
Rising gasoline costs have worried economists, as high prices at the pump pressure U.S. consumers and leave them with less money to spend elsewhere.
But without details of the timing, volume and duration of the emergency drawdown, U.S. crude pared losses.
NYMEX April crude fell for a second day and settled at $105.11 a barrel, down 32 cents, or 0.30 percent, up from a session low of $103.78. In London, crude for April delivery expired and settled at $123.55 a barrel, falling $1.42, or 1.14 percent.
U.S. Treasury prices slipped as stocks' advance and the stronger outlook for the economy eroded the appeal of safe-haven U.S. debt.
The benchmark 10-year U.S. Treasury note was down 2/32, with the yield at 2.2812 percent.
The dollar also fell from an 11-month high against the yen and a one-month high against the euro.
The greenback dropped 0.23 percent to 83.45 yen and the euro advanced 0.45 percent to $1.3086.
(Additional reporting by Edward Krudy and Ryan Vlastelica; Editing by Dan Grebler, Leslie Adler)