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Stocks rise, sending S&P 500 and Nasdaq indexes to their highest 2016 closes

Wall Street
Outside the New York Stock Exchange.
(Mark Lennihan / Associated Press)

U .S. stocks rebounded from an early slide Thursday, nudging the Standard & Poor’s 500 index and Nasdaq composite to their highest closes of the year.

Healthcare companies led the comeback. Energy stocks declined the most after a meeting of OPEC ministers ended without an agreement on cutting production of crude oil.

A late-afternoon reversal delivered the second gain in two days for the stock market in what has been a muted week of trading. Investors have been on the sidelines waiting for clues as to whether the Federal Reserve will raise its key interest rate at the central bank’s next meeting of policymakers this month.

Many will be looking to Friday, when the Labor Department releases its latest monthly jobs report.

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“It is the last major data point for the Fed to digest before they go into their mid-June meeting,” said Bill Northey, chief investment officer at the U.S. Bank Private Client Group.

The Dow Jones industrial average rose 48.89 points, or 0.3%, to 17,838.56.

The S&P 500 index advanced 5.93 points, or 0.3%, to 2,105.26. The last time it was higher this year was mid-session April 20. The index is now about 1.2% below its all-time high set in May last year.

The Nasdaq rose 19.11 points, or 0.4%, to 4,971.36. That eclipsed its previous high this year, which was April 18.

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Seven of the 10 sectors in the S&P 500 posted gains, led by healthcare companies. Health insurer Humana climbed the most in the index, advancing 5.6% to $187.36. Drugmaker Endo International rose 4.9% to $17.44. And Aetna climbed 4.1% to $120.03.

Major stock indexes had been stuck in the red for much of the day as investors monitored the OPEC meeting in Vienna.

Oil ministers ended the meeting without reaching a consensus on regulating supplies. That sent crude oil prices lower initially, but they later reversed course.

Benchmark U.S. crude oil rose 16 cents, or 0.3%, to $49.17 a barrel in New York. Brent crude, which is used to price international oils, advanced 32 cents, or 0.6%, to $50.04 a barrel in London.

“OPEC taking a pause or choosing not to institute any production caps was not surprising given the fact that we’ve seen oil come up near $50 a barrel,” Northey said.

Even so, energy stocks were the biggest laggard in the S&P 500. Shares in several oil drilling and exploration companies declined, with Diamond Offshore Drilling sliding the most. That stock fell 4% to $24.30.

Investors also weighed the latest company earnings and deal news.

L Brands, the company behind the Victoria’s Secret brand, rose 4.3% to $71.33 after it reported its latest sales figures.

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Johnson & Johnson rose on news that the company agreed to buy Vogue International, a privately held maker of hair-care products, for about $3.3 billion. Vogue’s hair-care products are sold in the U.S. and 38 other countries. Johnson & Johnson shares rose 1.5% to $114.49.

Some companies’ results put traders in a selling mood.

Online storage provider Box tumbled 11.5% to $11.34 after the company reported disappointing results.

Conn’s sank 26.3% to $8.63 after the retailer reported quarterly results that fell short of analysts’ estimates.

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European stock indexes were mixed after the European Central Bank said its stimulus measures are helping the eurozone economy and need time to work before any new monetary jolts are added. Germany’s DAX was little changed, France’s CAC 40 fell 0.2% and Britain’s FTSE 100 lost 0.1%.

Japan’s Nikkei 225 fell 2.3% after Prime Minister Shinzo Abe decided to postpone a sales-tax hike to avoid shocks to the faltering recovery. Hong Kong’s Hang Seng index rose 0.5%. South Korea’s Kospi rose 0.1%. Australia’s S&P/ASX 200 lost 0.8%.

In other energy futures trading, natural gas rose 2 cents, or 1%, to $2.405 per 1,000 cubic feet. Wholesale gasoline rose 2 cents, or 1.2%, to $1.63 a gallon, and heating oil rose a penny to $1.51 a gallon.

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U.S. government bond prices rose. The yield on the 10-year Treasury note fell to 1.81% from 1.84%.

In currency markets, the dollar fell to 108.91 yen from 109.54. The euro fell to $1.1148 from $1.1186.

Precious and industrial metals futures were little changed. Gold fell $2.10 to $1,212.60 an ounce, silver rose 10 cents to $16.03 an ounce and copper was flat at $2.07 a pound. 

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UPDATES:

2:26 p.m.: This article was updated with closing prices and additional information.

10:03 a.m.: This article was updated with more recent prices and additional information.

This article was originally published at 7:01 a.m.


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