Stocks Higher on Economy Hopes

U.S. stocks mounted a broad advance Thursday as investors snapped up technology shares such as Microsoft Corp. (MSFT) and optimism about the economy boosted industrial stocks, pushing the Dow to a record close.

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The Dow Jones industrial average was up 72.82 points, or 0.59 percent, at 12,514.98. The Standard & Poor's 500 Index was up 8.97 points, or 0.63 percent, at 1,423.82. The Nasdaq Composite Index was up 25.52 points, or 1.04 percent, at 2,484.85.

It was the first time in 2007 that the Dow Jones industrial average closed at a record high, led by a 3.5 percent rise in Microsoft, as well as gains in shares of United Technologies Corp. (UTX) and 3M (MMM) Co.

Microsoft shares jumped to their highest level since March 2002 and were also the biggest positive influence on the Nasdaq and the S&P 500 index.

With crude oil prices down more than 15 percent since the start of the year, investors are putting money in areas that they see poised to outperform after lagging the market last year.

"This is the time of year where you're usually seeing reinvestment demand from pension funds" and other investors, said Frank Gretz, market analyst and technician for Shields & Co., a brokerage in New York. "It's momentum."

The Nasdaq rose 1 percent and hit a fresh six-year high. Shares of Google Inc. (GOOG) were among the top positive influences on the index after Goldman Sachs raised its profit view of the Web search company.

Shares of Microsoft rose $1.04, to $30.70, while Google shares rose 2.1 percent, or $10.26, to $499.72.

A higher-than-expected profit from biotech company Genentech Inc. (DNA) brightened the outlook for corporate earnings at the start of the reporting period. Its shares rose 4.4 percent to $87.40.

Genentech's positive earnings news late on Wednesday followed an upbeat report from aluminum maker Alcoa Inc. (AA), which gave higher-than-forecast results on Tuesday.

Earlier on Thursday, a government report showed a larger-than-expected drop in the number of Americans filing new claims for jobless benefits last week.

Shares of big manufacturers rose, with 3M up 1 percent, or 80 cents, to $78.65, and United Technologies up 1.6 percent, or $1.01, to $63.70.

"There was a strong weekly jobless claims number, indicating the economy may be on better footing than previously thought," said Michael Sheldon, chief market strategist at Spencer Clarke in New York.

February crude fell $2.14 to settle at $51.88 a barrel. Shares of Exxon Mobil Corp. (XOM) slipped 1 cent to close at $70.98.

Energy shares helped lead stocks' advance earlier in the day, but lost ground as oil prices extended losses.

From the beginning of the year, front-month crude prices have fallen more than $9, or 15.2 percent.

Trading was active on the New York Stock Exchange, with about 1.68 billion shares changing hands, below last year's estimated daily average of 1.84 billion, while on Nasdaq about 2.43 billion shares traded, above last year's daily average of 2.02 billion.

Advancing stocks outnumbered declining ones by a ratio of about 12 to 5 on the NYSE and by 2 to 1 on Nasdaq.

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