Stocks Stanch the Bleeding With Positive Session as Oil Rebounds

A rebound in oil prices and reassuring words from Europe's top banker sent U.S. stocks higher on Thursday, stanching the bleeding from a series of sharp selloffs to begin the year.

The Dow Jones industrial average closed up 115.94 points, 0.74 percent, after earlier rising than 250 points. The Standard & Poor's 500 and Nasdaq composite both also finished in positive territory, with the former adding 9.66 points, or 0.52 percent, and the latter eking out a gain of 0.37 points, or 0.01 percent.

U.S. crude oil settled up 4.2 percent Thursday at $29.53 per barrel after being up more than 6 percent earlier in the session.

It was a welcome respite for a commodity that has been knocked down over the past week to lows not seen since 2003.

The upward move came despite weekly oil inventories that showed an increase in crude oil stocks and U.S. gasoline stocks. Distillate stocks showed a slight decline.

Also supporting gains were morning comments from European Central Bank President Mario Draghi that raised hopes of more stimulus as early as the March meeting.

Draghi let rattled investors know that the European Central Bank is ready to take action if plunging oil prices and weaker growth in China hurt the economy.

China's Economic Slowdown Masks Promise of Growing Middle Class

But he didn't go any further than words. The chief monetary authority for the 19 countries that use the euro currency left its key interest rates untouched and didn't ramp up its existing 1.5 trillion-euro ($1.63 trillion) monetary stimulus program.

Still, Draghi's remarks cheered investors on this side of the pond, sending Dow futures, which had been down, up more than 100 points shortly before the market opened.

The rally provided some much-needed good news for the markets, which have been pounded so far in 2016.

The Dow Jones average, which was created in 1896, has never begun a year with 12 worse trading days. As of Wednesday's close, the Dow has fallen 9.5 percent.

The S&P 500 has fared worse in a year's first 12 sessions just once -- in 2009.

Is China really to blame for the global sell-off?

Markets in Asia extended losses on Thursday, with the Nikkei ending around 2.4 percent lower. That leaves the index deeper into bear territory after losing 3.71 percent in Wednesday's session. China's main Shanghai Composite ended over 3 percent lower, while the Shenzhen tumbled over 4 percent.

In Europe, Draghi's remarks also provided some relief, evidenced by a jump of more than 1 percent for London's FTSE, Germany's DAX and France's CAC 40.