Stocks turned higher, pushed upward by credit card companies despite some less-than-stellar economic reports and news that oil supplies took a dramatic and unexpected slide.
Heading towards 1 pm ET major indexes each were posting solid gains. Tepid growth in gross domestic product and an unexpected surge in unemployment claims held stocks back early, while the drop in crude supplies briefly stunned the market and saw oil prices gain. But that move quickly reversed itself.
The Dow pushed past a 100-point gain while the Nasdaq added more than 1 percent.
Shares gained sharply for Visa, Mastercard and American Express on a report that US consumers were using their credit cards more.
Financials were broadly higher, with gains also posted by Morgan Stanley and Lehman Brothers among others.
Pharmaceuticals helped boost the tech-heavy Nasdaq, on news that Bristol-Myers Squibb plans to buy Kosan Biosciences, whose shares gained more than 200 percent on the news.
Shares of major energy producers, particularly ConocoPhillips , were all lower.
Oil surged after the 10:30 am report on crude stocks, but quickly surrendered gains and fell more than $3, near $127 a barrel. Dollar-denominated commodities did poorly overall as the US currency staged a rally fueled largely by talk of an interest rate increase.
The Federal Reserve may need to contemplate rate rises to fight inflation, even as the US economy is still weak, two Fed policy-makers warned, lending weight tomarket suspicions that rate cuts were over.
In earnings news, quarterly profit at Costco , the biggest warehouse club operator, rose partly due to a 13 percent jump in sales.
Fellow discounter Big Lots also soared as it beat expectations on a 20 percent increase in sales.
But retailer Sears Holdings reported an unexpected first-quarter loss, as sales fell at its Kmart and Sears stores and markdowns hurt margins.
Global miner Rio Tintosaid its production will continue growing for the next seven years and it forecast that commodities prices will continue to rise. Shares slumped despite the generally bullish comments.
Also, shares of equipment manufacturer Joy Global gained after its first-quarter earnings were ahead of analyst estimates, even though profit fell 7 percent.