US Markets

S&P closes at highest since November; Street awaits jobs Friday

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U.S. stocks closed at session highs Thursday, with health care stocks leading, ahead of the highly anticipated employment report due Friday morning.

The S&P 500 topped 2,100 for the first time in the close since April 20 to end at its highest since Nov. 3, 2015. (Tweet This)

"It's a positive sign. ... It's going to come down to tomorrow's jobs report," said JJ Kinahan, chief strategist at TD Ameritrade.

"I think it's really just people covering positions on the close," he said.

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Health care was the top S&P performer with gains of 1.3 percent, bringing the sector into positive territory for the year so far. DuPont and Johnson & Johnson had the greatest positive impact on the Dow Jones industrial average. Earlier in the day, Johnson & Johnson said it would acquire Vogue International for $3.3 billion.

U.S. crude oil futures settled up 16 cents, or 0.33 percent, at $49.17 a barrel.

Oil turned higher after weekly crude oil inventories showed a draw of 1.4 million barrels. Earlier, oil traded lower after OPEC agreed to no change in policy and no output ceiling.

Read MoreOPEC fakes unity, conflicts remain — analysts

"I think oil prices will have less of an impact on stocks because there's less concern that stresses there will lead to impairment of bank capital," said David Lefkowitz, senior equity strategist at UBS Wealth Management Americas.

The Russell 2000 outperformed, closing up about two thirds of a percent for its first four-day win streak since April 20 and within 10 percent of its 52-week intraday high, out of correction territory.

12-month performance

The S&P 500 was within 1.5 percent of its 52-week intraday high, while the Dow was within 2 percent of its 52-week intraday high.

"We're at the upper end of the trading range here and the Fed's going to be raising interest rates," said Peter Boockvar, chief market analyst at The Lindsey Group. "This territory becomes more difficult to sustain (and) you wonder what the catalysts are to get us higher from here."

In U.S. economic news, the private sector ADP payroll report was 173,000 in May, a touch below Reuters expectations for 175,000 jobs. The April report was revised up to 166,000 from 156,000.

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"Everyone's going to be holding their breath for the jobs number tomorrow," said Doug Cote, chief market strategist at Voya Investment Management.

The May non-farm payrolls report is expected Friday morning before the opening bell.

Treasury yields were lower, with the 2-year yield around 0.88 percent and the 10-year yield near 1.80 percent.

The U.S. dollar index was mildly higher, with the euro near $1.115 and the yen near 108.9 yen against the greenback.

Ahead of uncertainties such as the "Brexit" vote and the Federal Reserve's decision on interest rates, "right now I think you've got people who are stuck in neutral and the market is stuck in neutral," said Art Hogan, chief market strategist at Wunderlich Securities.

Dallas Fed President Rob Kaplan said in a Dow Jones report he would likely support a rate rise in June or July, while noting the Fed should raise rates gradually.

Read MoreJune rate hike would give Fed option for 3 increases this year: Kovacevich

Earlier, Fed Board Governor Daniel Tarullo said Britain's possible exit from the European Union will be a factor in the Fed's decision on rates later this month,

"In the short term it is more a question of the immediate impact on markets," Tarullo said in a Bloomberg TV interview, Reuters reported. "If there are implications for growth over time, to the degree it's a factor (in the June rate decision) it's taking into account what will happen in financial markets and the immediate aftermath of the vote."

European Central Bank President Mario Draghi said inflation rates are likely to remain very low or negative in coming months, Dow Jones reported. He added that inflation should pick up in the second half of 2016.

The ECB kept interest rates unchanged. The central bank raised its 2016 inflation forecast to 0.2 percent from 0.1 percent seen in March and kept its longer-term forecasts steady, with expectations of a 1.6 percent inflation rate in 2018, still short of its target of almost 2 percent, Reuters said.

European stocks closed narrowly mixed.

In Asia, stocks closed mixed with the Shanghai composite about 0.4 percent higher but the Nikkei 225 down 2.3 percent.

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The Dow Jones industrial average closed up 48.89 points, or 0.27 percent, at 17,838.56, with DuPont leading advancers and Exxon Mobil the greatest laggard.

The closed up 5.93 points, or 0.28 percent, at 2,105.26, with health care leading seven sectors higher and energy the greatest laggard.

The Nasdaq composite closed up 19.11 points, or 0.39 percent, at 4,971.36.

The CBOE Volatility Index (VIX), widely considered the best gauge of fear in the market, traded lower near 13.6.

About two stocks advanced for every decliner on the New York Stock Exchange, with an exchange volume of 958 million and a composite volume of 3.5 billion in the close.

Gold futures for August delivery settled down $2.10 at $1,212.60 an ounce, its lowest since Feb. 22.

Major U.S. Indexes

On tap this week:


3:45 a.m. Chicago Fed President Charles Evans in London

8:30 a.m. Employment report

8:30 a.m. International trade

9:45 a.m. Services PMI

10 a.m. ISM non-manufacturing

10 a.m. Factory orders

12:30 p.m. Fed Governor Lael Brainard at Council on Foreign Relations, DC

1 p.m. Rig count


3 a.m. Cleveland Fed President Loretta Mester

*Planner subject to change.

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