Stocks closed at new highs for yet another session despite mixed economic news and a varied batch of earnings reports, putting all three major indices on track for the best April since 2009.
The Dow Jones Industrial Average rose 72.35 points, or 0.6 percent, to close at 12,763.31, the highest close since May 20, 2008. The gain follows a rallyWednesdaysparked by Fed chairman Ben Bernanke's remarks during his first-ever press conference.
Among Dow components, Boeing and DuPont gained, while Hewlett-Packard and Alcoa fell.
Meanwhile, the S&P 500 rose 4.82 points, or 0.4 percent, to close at 1,360.48, the highest close since June 9, 2008.
The Nasdaq rose 2.65 points, or 0.09 percent, to close at 2,872.53, the highest close since Dec. 12, 2000. The tech-heavy index had traded in negative territory most of the session.
Among the key S&P sectors, financials and consumer staples gained, while energy and technology slipped.
The CBOE Volatility Index, widely considered the best gauge of fear in the market,fell to nearly 14.
Market volatility has been low this year, and currently is at "very low levels," said Randy Frederick, director of trading and derivatives at Charles Schwab.
For April, the so-called fear index has averaged about 18.60, while last year, the VIX averaged about 22.50, Frederick said.
In late afternoon trading, VIX futures fell far less than the VIX itself, indicating the market could turn negative Friday morning, he added.
At session's end, the spread between the risk premium adjusted future and the VIX was about 1.40. A spread of more than 1.20 is a signal the VIX could reverse course, Frederick said. In this case that would mean stocks could fall as the VIX rises.
The Dow Jones Transportation Averageended at 5,510.66, above its record closing level of 5,492.95 on Thursday, which was reached on June 5, 2008.
Small cap stocks also ended at new record highs. The Russell 2000 Indexof small caps rose 0.4 percent to 861.55 after hitting an all-time high on Wednesday, closing at 858.31.
The dollar struggled in the wake of weak economic news and affirmation of the Fed's decision to continue to keep short-term interest rates low. The index has slid against a basket of currencies almost 4 percent in Aprilto the lowest levels since March 2008.
The dollar's weakness helped to push gold priceshigher again to record levels. Gold futures for May deliver rose 0.94 percent to $1,530 an ounce, the 12th record settling price for the precious metal in April. Comex silver for May delivery rose 3.4 percent to $47.52, the highest level since Jan. 17, 1980.
A big batch of earnings was released before the market opened. Of the 291 companies reporting so far this quarter, representing 58 percent of all S&P 500 companies, 74 percent have beaten earnings estimates while 70 percent have beaten revenue estimates, according to Thomson Reuters.
Exxon Mobil fell slightly after reporting earnings results Thursday morning as investors focused on revenues that fell shyof expectations, although profits were better than expected.
Many major oil companies also fell, including ConocoPhillips ,Sunoco and Chevron , which reports earnings on Friday before-the-bell. Deutsche Bank cut its price target on ConocoPhillips to $85 from $90 and reduced its rating to "hold" from "buy."
Oil prices were mixedamid weak economic data and a weaker dollar. London Brent crude fell 0.9 percent to $125.02 a barrel, while U.S. light crude rose 0.09 percent to close at $112.86.
Procter & Gamble sank afterlowering the high end of its profit forecastbecause of rising materials costs.
Meanwhile, PepsiCo rose despite reporting that rising costs hurt first quarter profitsfor the snacks and drinks maker.
Starbucks slipped after the coffeehouse chain posted a profit that matched forecasts, though the company edged sales expectations. However, the firm's outlook disappointed analysts. Meanwhile, Barclays raised its price target on the firm to $35 from $30.
Dow Chemical gained after posting strong first quarter profits, driven by rising demand for plastics.
Aetna gained almost 5 percent after the heath insurer raised its 2011 profit target after posting results well above estimates on lower-than-expected medical costs.
Among tech earnings, EBay shares traded flat even after the online auction giant posted results that topped forecastsand raised its outlook for the fiscal year. In addition, at least eight brokerages raised their price targets on the firm.
Baidu fell despite doubling its profits from a year ago, and delivering a better-than-expected revenue forecast.
That may be simply because traders are taking a breather on the high-flier, as well as other fast-growing tech stocks.
"Tech earnings have been the catalyst for the rally since the start of earnings season, but today we saw one of the first examples of investors selling off a strong report with Baidu.com," Scott Redler, chief strategic officer at T3live.com said in a note to clients.
"Some rest or downside action would be healthy here, and traders are taking risk off the table today with that in mind," Redler said.
Apple also fell ahead of the Nasdaq 100 rebalancing, which takes place on Monday and will reduce the iPhone-maker's weighting from about 20 percent to about 12 percent.
"If Apple gets going again next week, it could be another catalyst to power the Nasdaq higher," Redler said.
Citrix Systems jumped more than 8 percent after the tech company posted strong results and raised its 2011 outlook, prompting at least 10 analysts to raise their price targets on the stock.
However, Akamai plunged almost 15 percent after the online content delivery firm
Microsoft and Motorola Mobility were scheduled to report earnings after-the-bell tonight.
In M&A news, Exelon confirmed it will buy Constellation Energy for $7.9 billion. The deal between the rival power companieswould involve Constellation shareholders receiving 0.93 shares of Exelon stock for each Constellation share. Shares of both companies gained.
NYSE Euronext rose after reporting upbeat results for the first quarter, and as NYSE Chairman Jan-Michiel Hessels called the Nasdaq proposal "an empty vessel" at the firm's shareholder meeting.
Johnson & Johnson fell even after the drugmaker boosted its dividend by 5.6 percent to 57 cents a share from 54 cents.
Meanwhile, Panasonic advanced even after the consumer electronics giant said it would cut another 17,000 jobs and close up to 70 factories around the world over the next two years.
Volume on the consolidated tape of the New York Stock Exchange was nearly 4 billion shares, while 962 million changed hands on the NYSE floor.
The mostly positive tone to the market follows a strong response to Fed Chairman Ben Bernanke's press conference Wednesday, held after the Fed's policy-setting committee met.
It was good for investors to hear Bernanke's explanation of the Fed's thinking, although he didn't say much new, said Tim Speiss, head of personal wealth advisors at EisnerAmper.
"It gives a lot of confidence to investors," Speiss said.
While Speiss is generally upbeat about the economic outlook, he is concerned about the 5.2 percent drop in government spending in the first quarter. "When that starts to slow down, you can see a deceleration in (economic) forecasts," he said. "We'll keep an eye on that."
Treasurys trimmed gainsafter the government auctioned $29 billion in 7-year notes, which had a high yield of 2.712 percent and a bid-to-cover of 2.63.
On the economic front, the nation's gross domestic product grew at an annual rate of 1.8 percentin the first quarter compared with a 3.1 percent gain in the fourth quarter last year, according to the first reading by the government.
The slowdown is viewed as a temporary result of high gas prices, which are expected to stabilize, according to economists, including Federal Reserve Chairman Ben Bernanke, Reuters reported.
Initial jobless claims for the week ended April 23 rose by 25,00 to 429,000, the highest level since January, the Labor Department said. The prior week's claims were revised upward to 404,000 from 403,000. Economists surveyed by Reuters had expected claims would fall to 392,000.
The pending home sales index of contract signings, not closings, rose 5.1 percent to 94.1 in March, from 89.5 in February, according to the National Association of Realtors. Homebuilding stocks were mixed after the news, with KB Home and Lennar trading lower, while Toll Brothers and PulteGroup rose.
In Europe, markets closed at an eight-week high, propelled by earnings.
On Tap This Week:
THURSDAY: Earnings after-the-bell from Microsoft, Motorola Mobility.
FRIDAY: Personal income, personal spending, Chicago PMI, Consumer Sentiment; Earnings before-the-bell from Caterpillar, Chevron, Merck, DR Horton.
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