NEW YORK — Investors are seeing a jump in oil as reason to snap up stocks in the final days of the second quarter.
Energy, industrial and materials stocks pulled the market higher in light trading Monday as investors looked to put money into areas that would benefit from an economic recovery.
Crude rose $2.33 to settle at $71.49 a barrel on the New York Mercantile Exchange after China said it would boost oil reserves and Nigerian militants partly shut down an offshore oil platform.
Stocks rose sharply after seesawing in the early going. After running the market up more than 30 percent since March on a litany of "less bad" economic data, investors have become more cautious about the pace of the economy's recovery in recent weeks and are looking for more concrete signs of growth.
With the quarter's end coming up on Tuesday some money managers were buying stocks bolster their returns. The Standard & Poor's 500 index is up 16.2 percent since the start of the April-June quarter.
"I think there might be a little bit of quarter-end of window dressing going on," said Robert Pavlik, chief market strategist at Banyan Partners LLC in New York. He also said that the jump in crude oil is helping to support the overall market.
According to preliminary calculations, the Dow Jones industrial average rose 90.99, or 1.1 percent, to 8,529.38. The S&P 500 index rose 8.33, or 0.9 percent, to 927.23, while the Nasdaq composite index rose 5.84, or 0.3 percent, to 1,844.06. Stocks ended last week mixed.
There was little economic news Monday but the week, which is abbreviated by the Independence Day holiday on Friday, brings key data that will give investors a better sense of where the economy is headed.
Doreen Mogavero, president of Mogavero, Lee & Co., said the market likely will trade in a tight range as investors await a clearer signal on the economy.
"We want to see if things really are getting better," Mogavero said.
Of particular importance is the government's monthly employment report, due Thursday. Though considered a lagging indicator of the country's economic health, the unemployment rate is still one of the most closely watched gauges of the economy. The labor market is intricately tied to many facets of the economy, including consumer spending.
Investors will also get readings on consumer confidence and manufacturing this week.
The Dow is up 30.3 percent from a 12-year low on March 9, though it has fallen 3.1 percent from a five-month high on June 12. The blue chips are now down only 2.8 percent in 2009.
Harry Rady, chief executive of Rady Asset Management, is concerned that although the market's rally has lost steam in the past three weeks traders are still too optimistic about how quickly the economy can recover.
"I see a bit of complacency creeping into the market," he said. "The market has run up and that has the inverse effect of what it should."
Rady is uneasy watching a gauge of fear in the stock market continue its retreat, and contends that investors are overlooking trouble spots in the economy like heavy debt loads and weakness in the dollar. The Chicago Board Options Exchange Volatility Index, or VIX, is a measure of stock market volatility that has been easing since early March. The VIX is down 36 percent in 2009 and stands below 26. The historical average is 18-20. It hit a record 89.5 in October at the height of the financial crisis.
Beyond the stock market, traders followed the sentencing of Bernard Madoff, who was given the maximum 150 years in prison for his multibillion-dollar fraud scheme. A U.S. District judge handed down the sentence in New York.
Madoff pleaded guilty in March to securities fraud and other charges. Prosecutors had been seeking the 150-year jail sentence, while his lawyers had sought 12 years in prison.
About two stocks rose for every one that fell on the New York Stock Exchange, where volume came to a light 1.1 billion shares compared with 2.3 billion traded Friday. Volume was heavy because of the annual reconstitution of the Russell 3000 index. That forced investors to buy and sell hundreds of stocks.
Bond prices rose, pushing yields lower. The yield on the benchmark 10-year Treasury note fell to 3.48 percent from 3.53 percent late Friday.
The dollar was mixed against other major currencies. Gold prices fell.
The gains in commodities lifted energy, industrial and materials stocks. Exxon Mobil Corp. rose $1.53, or 2.2 percent, to $70.58, defense contractor General Dynamics Corp. rose $1.54, or 2.8 percent, to $57 and Eastman Chemical Co. rose $1.38, or 3.7 percent, to $38.79.
In other trading, the Russell 2000 index of smaller companies fell 2.61, or 0.5 percent, to 510.61.
Overseas, Britain's FTSE 100 rose 1.3 percent, Germany's DAX index advanced 2.3 percent, and France's CAC-40 rose 2 percent. Japan's Nikkei stock average fell 1.0 percent.