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By Mike Brunker and Evelyn Cheng, CNBC

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.

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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.

Reuters and Associated Press contributed.