U.S. stocks advanced Thursday, rebounding from the previous day’s tumble, as jobless claims declined while a retreat in Italian bond yields and the selection of a new Greek premier tempered concern about Europe’s debt crisis.

Energy shares had the biggest gain in the Standard & Poor’s 500 Index among 10 groups, rising 1.8 percent as oil rallied. Cisco Systems, the largest maker of networking equipment, climbed 5.7 percent as profit and sales beat estimates. Merck jumped 3.5 percent after raising its dividend. Apple slumped 2.6 percent amid concern that the company might ship fewer units of its iPad tablet this year because of supply constraints.

The S&P 500 rose nearly 0.86 percent to 1,239.70. The benchmark gauge for American equities lost 3.7 percent Wednesday as one out of 500 stocks in the index gained, the fewest since last June. The Dow Jones Industrial Average advanced 112.92 points, or 1 percent, to 11,893.86.

“The economic data will come back into focus as we shift our vision away from the political fear in the euro zone,” said Mike Ryan, the New York-based chief investment strategist at UBS Wealth Management Americas. “As we remove uncertainties, the market starts focusing less on the risk scenarios,” he said. “A decline in claims is very positive.”

The appointment of Lucas Papademos, the former vice president of the European Central Bank, to lead a unity government in Greece sent stocks higher. Italian government bonds rose after the ECB was said to purchase the securities, and the nation sold the maximum amount of one-year bills on offer at an auction. A statement from S&P affirming France’s rating and saying that a “technical error” was to blame for a earlier message suggesting a downgrade also lifted equities.

Speculation that Europe’s crisis would not derail the economy sent the Morgan Stanley Cyclical Index up 0.9 percent Thursday. 3M gained 1.7 percent to $80.32. Hewlett-Packard rose 1.6 percent to $26.76. The Dow Jones Transportation Average increased 1.3 percent even as a gauge of airlines sank on higher oil prices. The KBW Bank Index added 0.8 percent.

“I’m not willing to step up and proclaim all-clear, but we’re moving in the right direction,” said Don Wordell, a fund manager for Atlanta-based RidgeWorth Capital Management. “The most positive news of the day was the jobless-claims data showing that the U.S. economy is slowly getting better.”

The Labor Department report showed the number of Americans filing applications for unemployment benefits fell to the lowest level in seven months, a sign that the recovery might be encouraging companies to limit cuts in head count. Federal Reserve Chairman Ben S. Bernanke said the central bank is concentrating “intently” on reducing unemployment and projects inflation to stay under control for the “foreseeable future.”

As oil rose to the highest level in more than three months on optimism that a recovering economy will boost fuel demand, Exxon Mobil increased 1.7 percent to $78.70. Chevron added 1.2 percent to $105.50.

Cisco Chief Executive Officer John Chambers is eliminating jobs, scaling back operating expenses and revamping a management structure that slowed decision making. The company also is refocusing on its main products: switches and routers, which ferry data across networks.

— Bloomberg News

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Markets stabilized Thursday after Greece agreed on a new prime minister and Italy vowed to fast-track reforms, with speculation a new technocrat premier was waiting in the wings. Italian bond yields dropped from dangerous levels. (Nov. 10)