A rebound in retail sales and strong jobs reports pushed stocks near their highest levels of the year.
U.S. retailers had their best June sales results since 1999 as shoppers were lured into stores by warm weather and deep discounts. Kohl's Corp., Target Corp., and Urban Outfitters Inc. each gained more than 6 percent.
Investors have been concerned that high gas prices would constrain consumer spending as people looked for ways to save money. The higher sales figures reassured markets that consumers were becoming more willing to spend again.
"The closest thing to an unadulterated barometer of our progress is same-store sales," said Jack Ablin, chief investment officer at Harris Private Bank in Chicago. Same-store sales for the 28 retailers who reported them on Thursday were up 6.9 percent. "Everything is tied to it: Sales drives profits, profits drive hiring and hiring drives sales. It's a neat, virtuous circle."
An improving job market likely helped. The number of people who made first-time claims for unemployment benefits dropped last week to a seven-week low of 418,000, the government reported. That's a sign that employers are laying off fewer workers.
