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Stocks Hit Record Highs After European Central Bank Cuts Rates

Stocks gained on Thursday, with both the Dow and the S&P 500 setting records, after the European Central Bank slashed rates and investors looked ahead to Friday's employment report.

The Dow Jones Industrial Average closed unofficially 98 points higher, at 16,836.11, eclipsing its record high from Monday. The S&P 500 rose 12 points to close at 1,940.46, above Thursday's close. The Nasdaq added 44 points.

"This was a historic move by a major central bank," Mark Luschini, chief investment strategist at Janney Montgomery Scott, said of the ECB's decision to cut its key lending rate to 0.15 percent from 0.25 percent and the overnight deposit rate to 0.1 percent from zero, as policy makers attempt to fend off deflation in the region.

The added measures that have the ECB offering banks cheap, long-term funding so long as they use it to hike lending to companies were intended to provide "liquidity into the corporate marketplace, where banks have been reluctant lenders," said Luschini.

"Now we're looking at tomorrow's unemployment report. The news cycle only lasts five minutes. The market is anticipating, and I think correctly so, that the jobs number should be good, or somewhere around 200,000 in new jobs," said Paul Nolte, a senior vice president and portfolio manager at Kingsview Asset Management.

"Certainly based on the weekly jobless claims number, the jobs picture looks good," Nolte said of Thursday data that showed fewer Americans filed for unemployment benefits during the past month than at any time in seven years.

After weakening against the dollar, the euro hovered at $1.37 per euro, while the 10-year U.S. Treasury yield used in figuring mortgage rates and other consumer loans down at 2.584 percent.

Gold futures for August delivery rose 80 cents to $1,245.10 an ounce.