Stocks closed higher in thin trading Thursday, led by strength in materials and industrials, erasing losses after several weak economic reports from earlier in the session.
The Dow Jones Industrial Average rose 21.57 points, or 0.17 percent, to finish at 12,471.02, led by Alcoa and Caterpillar. Chevron led the blue-chip laggards.
The S&P 500 eked out a gain of 3.02 points, or 0.23 percent, to close at 1,295.50, near the psychologically-significant 1,300 level. The Nasdaq added 13.94 points, or 0.51 percent, to end at 2,724.70 logging its sixth-straight day of gains.
The CBOE Volatility Index, widely considered the best gauge of fear in the market, finished below 21.
Among key S&P sectors, materials rallied, while energy led the decliners.
“The economic data in the last two to three months have been two steps forward, one step back and today was a step back,” said Ryan Detrick, senior technical strategist at Schaeffer’s Investment Research. “But all in all, we’re still encouraged by the fact that we’re off to a good start—we don’t seem to be as chained to the euro has we’ve been in the past and surprisingly, Europe’s what’s holding us together today.”
On the economic front, weekly claims for unemployment benefits gained more than expected, according to the Labor Department, climbing by 24,000 to a seasonally adjusted 399,000, the highest in six weeks.
Meanwhile, retail sales rose a disappointing 0.1 percent in December, the weakest pace in seven months, according to the Commerce Department, as consumers pulled back late in the holiday shopping season.
And businesses inventories gained 0.3 percent in November, according to the Commerce Department.
In Europe, Spain sold 4.2 billion euros in a new 3-year issue and 2.5 million euros in an existing bond maturing in 2016, raising more twice the amount it had targeted. Yields fell across the board.
Italy also successfully sold government debt, with the lowest yield on the 12-month maturity since June 2011.