Stocks ended slightly higher after trading lower most of the session as Federal Reserve Chairman Ben Bernanke indicated the central bank would continue to stimulate the economy, even amid signs of growing strength in the U.S. economy, and as investors awaited the January jobs report to be released Friday.
The Dow Jones Industrial Average rose 20.29 points, or 0.17 percent, to close at 12,062.26, the highest closing value since June 19, 2008. The blue-chip index squeezed out a gainthe previous session.
Cisco, Bank of America and AT&T led blue chips higher, while Merck and Microsoft fell.
The S&P 500 rose 3.07 points, or 0.24 percent, to close at 1,307.10, while the Nasdaq rose 4.32 points, or 0.16 percent, to close at 2,753.88. The CBOE Volatility Index, widely considered the best gauge of fear in the market, fell below 17.
Most key S&P 500 sectors rose, led by consumer discretionary, telecom, and consumer staples.
The market turned higher around 3 p.m., soon after the S&P 500 crossed about 1,304. That level may have triggered shorts who had bet the market would move lower despite the strong economic reports, said Marc Pado, U.S. market strategist and technical analyst at Cantor Fitzgerald.
"As soon as we triggered above 1,304 it was a rocket shot," Pado said. "Nobody wants to be short heading into tomorrow’s numbers."
The Labor Department will release nonfarm payroll data for January on Friday at 8:30 a.m.
Earlier, Federal President Bernanke said high unemployment and low inflation require the Fed to continue stimulating the economy, although he acknowledged the economy is getting stronger.
"Until we see a sustained period of stronger job creation, we cannot consider the recovery to be truly established," Bernanke said in remarks prepared for delivery at the National Press Club.
Turmoil in Egypt also remained in focus as thousands of supporters and opponents of President Mubarak battled in Cairo's main square, raining stones, bottles and firebombs on each other in scenes of uncontrolled violence as soldiers stood by without intervening.
The dollar rose against a basket of currencies, moderating gains in oil prices. Brent crude closed slightly below $102 a barrel, after topping $103 earlier, while U.S. light sweet crude dropped to under $91, even as the clashes in Egyptraised the prospect of further unrest in the Middle East.