Positive economic data, strong earnings and a sharp drop in oil prices sent stocks sharply higher Thursday and lifted the Standard & Poor's 500-stock index to a four-year high. The Nasdaq composite index also moved into positive territory for 2005.
Wall Street was encouraged by the latest reading of the Labor Department's consumer price index, which measures how much consumers pay at the retail level. The CPI was unexpectedly flat for June, while core CPI -- with food and fuel costs removed -- edged just 0.1 percent higher.
Record earnings from Apple Computer helped lift the technology sector, while a sharp 1.7 percent jump in retail sales for June assuaged fears that high oil prices would crimp consumer spending.
The S&P 500 rose 3.21, or 0.3 percent, to 1226.50, its best showing since closing at 1234.45 on July 3, 2001. The Nasdaq composite index climbed 8.71, or 0.4 percent, to 2152.82, its best close since Dec. 31. The Dow Jones industrial average rose 71.50, or 0.7 percent, to 10,628.89, its highest level since March 16.
Crude oil futures dropped sharply after the International Energy Agency predicted global demand would ease.
Lowe's rose 70 cents, to $62.90, after hitting an all-time high earlier in the session as retail stocks pushed higher. Target, which also reached a historic high, gained 52 cents, to $58.39, and Best Buy gained 60 cents, to $75, after surpassing its all-time high in morning trading.
Southwest Airlines climbed 44 cents, to $14.42, after reporting a 41 percent surge in profit for the second quarter, in a rare bit of good news for the airline sector. The company credited fare increases and rising passenger traffic for helping overcome rising fuel prices. AMR, parent of American Airlines, gained $1.08, to $13.87, and Delta Air Lines rose 61 cents, to $4.05.
General Motors jumped $1.13, to $37, as the struggling automotive sector also got a boost. Ford Motor gained 20 cents, to $10.89. Both stocks benefited from strong auto sales reported in June.
New York Stock Exchange composite index rose 2.57, to 7403.40.
American Stock Exchange index fell 24.53, to 1537.84.
Russell 2000 index of smaller-company stocks fell 4.63, to 663.02.
NYSE: 2.02 billion shares, up from 1.82 billion on Wednesday. Decliners outnumbered advancers 6 to 5.
Nasdaq: 1.86 billion shares, up from 1.52 billion. Decliners outnumbered advancers 5 to 4.
Crude oil for August delivery: $57.80, down $2.21.
Gold for current delivery: $419.60 a troy ounce, down from $423.90 on Wednesday.