Stocks rose on Thursday, lifted by a rebound in technology shares, while a surprisingly big rise in weekly jobless claims brought new worries about the economy and pushed defensive shares higher.
Investors scooped up technology bellwethers one day after the PHLX Semiconductor index <.SOXX> fell for a fifth straight day. Apple Inc
Defensive stocks such as consumer staples and healthcare also advanced, with Coca-Cola Co
The market has gone from a 'Just buy if it moves' kind of attitude to 'Maybe it's time to get back to fundamentals,' said Terry Morris, senior vice president and senior equity manager for National Penn Investors Trust Co in Reading, Pennsylvania.
It was a speculative rally because consumer staples and healthcare underperformed during that time as well, Morris added.
The Dow Jones industrial average <.DJI> gained 66.66 points, or 0.80 percent, to 8,351.55. The Standard & Poor's 500 Index <.SPX> rose 10.34 points, or 1.17 percent, to 894.26. The Nasdaq Composite Index <.IXIC> climbed 27.63 points, or 1.66 percent, to 1,691.82.
After a rally that had pushed the S&P 500 up more than 37 percent from a bear-market low on March 9, stocks have declined more than 4 percent since May 8 as investors reassessed the outlook for the economy.
Economists said despite signs of improvement, it will be some time before conditions begin to improve.
The number of U.S. workers filing new claims for jobless benefits rose to 637,000 and was more than expected in the latest week, according to government data, pushed up by plant shutdowns related to automaker Chrysler's bankruptcy. The report came on the heels of figures showing consumers were still reluctant to spend.
Separately, the Labor Department said prices received by U.S. producers rose at a brisk pace in April, driven by a surge in food costs.
United Technologies Corp
Wal-Mart Stores Inc
Shares of the world's largest retailer slid 1.4 percent to $49.30.
(Reporting by Chuck Mikolajczak; editing by Jeffrey Benkoe)