U.S. stocks rose Thursday as MedImmune Inc. (MEDI) put itself up for sale, lifting the biotech sector, and strong retail sales data relieved fears about consumer spending.
The Dow Jones industrial average gained 68.34 points, or 0.55 percent, to end at 12,552.96. The Standard & Poor's 500 Index rose 8.93 points, or 0.62 percent, to 1,447.80. The Nasdaq Composite Index climbed 21.01 points, or 0.85 percent, to 2,480.32.
A surge in oil prices gave investors a reason to buy energy companies' shares and helped push up the S&P 500. Exxon Mobil Corp. (XOM), up 0.8 percent, was among the biggest gainers in the S&P 500 and the blue-chip Dow average.
MedImmune Inc. said there were indications of interest from big drug makers and the American Stock Exchange index of biotechnology companies rose 2.5 percent. MedImmune's stock climbed 15.3 percent and was the among the names giving a major boost to the Nasdaq.
"The market is still flush with liquidity, and M&A will continue. That's a positive driver for stocks," said Phil Orlando, chief portfolio manager at Federated Investors in New York. "But the underlying fundamentals of the market are still pretty sloppy."
Retail stores warned that April sales could slow. But March sales were better than expected and relieved concerns about consumer spending, sending an index of retail stocks into positive territory.
The American Stock Exchange index of biotechnology companies rose 2.5 percent after MedImmune said it had hired Goldman Sachs (GS) to explore a sale of the company.
Increased merger and acquisition activity is seen as a sign that stocks are attractively priced. MedImmune shares rose 15.3 percent to $43.63 on the Nasdaq.
Gilead Sciences shares gained 3 percent to $78.99 and Amgen Inc.'s (AMGN) stock advanced 2.3 percent to $57.64, both on the Nasdaq.
Retailers, including J.C. Penney Co. Inc. and Wal-Mart Stores Inc. (WMT), said sales in March beat expectations, owing to an early Easter holiday. But many chains warned that comparable-store sales will be crimped in April.
Department store Dillard's Inc. got a strong boost from its sales figures, sending its stock up 4.4 percent to $34.59 on the New York Stock Exchange.
"The retail sales data we got this morning was pretty good and suggests that consumers are still spending. It seems to follow on from the strong jobs data from Friday," said Douglas Peta, a market strategist at J.& W. Seligman in New York.
The S&P Retail index initially fell 1.2 percent, before investors reassessed the retail sales data and pushed the index up 0.5 percent.
May crude oil rose $1.84, or about 3 percent, to settle at $63.85 per barrel on supply concerns created by problems at refineries and a big decline in U.S. gasoline stockpiles in the past week.
Exxon Mobil shares rose 0.8 percent to $77.39.
Dow Chemical Co. , the largest U.S. chemical company, fired an executive vice president and a member of its board, accusing them of engaging in unauthorized discussions about selling the company. Romeo Kreinberg, former head of performance plastics, denied the allegations.
On Monday a British newspaper said a consortium was preparing a bid for Dow, sending its stock up sharply.
On Thursday, Dow Chemical's stock rose 2 percent to $46 on the NYSE.
Trading was moderate on the New York Stock Exchange, with about 1.49 billion shares changing hands, below last year's estimated daily average of 1.84 billion. On Nasdaq, about 1.98 billion shares traded, below last year's daily average of 2.02 billion.
Advancing stocks beat declining ones by a ratio of about 2 to 1 on both the NYSE and the Nasdaq.