US stocks rose on Thursday, pushing the blue chip Dow and the broad S&P 500 to three-month highs as surging oil prices drove up demand for energy companies' shares, while the Nasdaq got a boost from biotech mergers. Investors bought Exxon Mobil Corp, up 1.5 percent at $60.12, after US crude futures jumped to within $2 of a record price set two months ago.
Meanwhile, the Nasdaq got a boost from biotech companies, after drug maker Pfizer said it planned to buy Vicuron Pharmaceuticals Inc for $1.9 billion. Vicuron's stock soared 79 percent to $28.21 and ranked as the Nasdaq's biggest percentage gainer.
"Otherwise, the market's range bound and I think it will remain that way. The pre-announcement season (for corporate earnings) is just around the corner."
The stock market's higher finish marked a reversal from a drop at midday after the Federal Reserve Bank of Philadelphia reported an unexpected drop in factory activity in the mid-Atlantic states - its first negative reading in 25 months - and contrary to economists' forecast calling for a gain.
The Dow Jones industrial average was up 12.28 points, or 0.12 percent, to end at 10,578.65, its highest close since March 18. The Standard & Poor's 500 Index was up 4.38 points, or 0.36 percent, to finish at 1,210.96, its highest close since March 8.
The tech-laced Nasdaq Composite Index was up 14.23 points, or 0.69 percent, to end at 2,089.15.
CIBC's McMahon added that the run-up in oil prices was bad news for consumers.
Energy companies' stocks, though, benefited from the jump in oil prices, with the NYMEX July futures contract jumping $1.01 to settle at $56.58 a barrel - less than $2 below the record price of $58.28 a barrel set on April 4.
That prompted investors to buy Exxon Mobil, as well as the stocks of its rival oil and gas producers Chevron Corp, up 2 percent, or $1.08, at $57.92, and ConocoPhillips, up 2.2 percent, or $1.27, at $58.60.
Exxon Mobil, Chevron and ConocoPhillips were the three biggest upward influences, in terms of points and percentage gains, on the S&P 500.
Metals-related stocks helped support the Dow and the S&P 500 as metal prices rallied, with COMEX gold for August delivery ending at $437.90, its highest settlement since April 29.
Aluminium producer Alcoa Inc, a Dow component, rose 1.3 percent, or 37 cents, to $27.93. Gold producer Newmont Mining Corp gained 3.5 percent, or $1.33, to $39.72. But the stock of automaker General Motors Corp limited the Dow's gains. GM fell 2 percent, or 72 cents, to $35.62.
In the biotech sector, Vicuron's stock price skyrocketed after Pfizer, the world's biggest drug company, said it planned to buy it for $1.9 billion in cash. Shares of Vicuron, which develops drugs to treat infections acquired in hospitals, surged $12.41 to close at $28.21 on Nasdaq. Vicuron's products include a drug to treat antibiotic-resistant infections.
Pfizer, a Dow stock, rose 0.6 percent, or 17 cents, to close at $28.60 on the New York Stock Exchange.
Shares of Momenta Pharmaceuticals Inc jumped nearly 63 percent, or $6.36, to $16.50 on Nasdaq after CIBC World Markets on Thursday raised its price target on the stock. A US court invalidated Sonafi-Aventis' patent for a blood-thinning drug for which Momenta has a generic formulation.
The American Stock Exchange Biotechnology index rose 2.4 percent to 551.74.
In the tech sector, another merger also helped the Nasdaq.
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