Bulls make it two in a row

NEW YORK (CNNMoney.com) -- Wall Street bulls showed no sign of backing down Thursday, building on the previous session's rally following a tame inflation reading, energy sector strength and a respite in the recent Treasury market selloff.

The Dow Jones industrial average (up 86.49 to 13,568.84, Charts) finished 0.5 percent higher, while the broader S&P 500 index (up 8.03 to 1,523.70, Charts) gained 0.5 percent. The tech-fueled Nasdaq composite (up 18.19 to 2,600.50, Charts) climbed 0.6 percent.

U.S. light crude oil for July delivery settled up $1.39 to $67.65 a barrel on the New York Mercantile Exchange.

Gold prices added $3.20 to $655.90. Treasury prices inched lower, raising the yield on the benchmark 10-year note to 5.22 percent up from 5.20 percent late Wednesday.

In currency trading, the dollar hit a 4-1/2 year high versus the yen and edged lower versus the euro.

Here's what was moving before the close:

The Dow climbed over 180 points Wednesday, helped by a handful of upbeat economic readings and some relief on the interest rate front.

Worries about higher inflation, rising Treasury yields and ultimately the Federal Reserve raising interest rates this year, prompted an investor selloff last week, sending the Dow down 1.8 percent.

A tame inflation reading buoyed both equity and Treasury investors Thursday, as the "core" reading of the Producer Price Index, which strips out volatile food and energy prices, rose just 0.2 percent in May, meeting expectations.

The overall reading of inflation at the wholesale level exceeded estimates by climbing 0.9 percent.

Thursday's "core" reading leaves the year-over-year rate in a range that is assumed to be acceptable to Fed policymakers.

Treasury prices held steady following the PPI reading, moving slightly lower in afternoon trade, putting the yield on the benchmark 10-year note at 5.22 percent, up slightly from late Wednesday. Treasury prices and yields move in opposite directions.

Markets also got some support from the oil and energy sectors as U.S. light crude oil for July delivery climbed $1.39 to $67.65 a barrel on the New York Mercantile Exchange.

"Oil and metals stocks are really leading the market," said Maira Thompson, a senior portfolio manager for Clark Capitol Management. "The slowdown that a lot of people anticipated hasn't appeared yet."

The Amex Oil index added 1.87 percent, the Amex Natural Gas index climbed 1.67 percent, while the Amex Gold Bugs index rose 1.57 percent.

In other economic news, mortgage rates posted their biggest jump in nearly 4 years, Freddie Mac said Thursday, sending the 30-year fixed rate to its highest level since July 2006.

Weekly jobless claims held steady at 311,000 last week, the Labor Department reported Thursday, short of analyst expectations.

On the corporate front, Bear Stearns (up $0.16 to $149.65, Charts, Fortune 500) reported lower quarterly earnings that missed estimates, due to lower bond trading revenue and a writedown.

Fellow investment bank Goldman Sachs (Charts, Fortune 500) reported higher quarterly earnings that topped estimates, thanks to good investment banking fees and stock trading. But the stock fell over 3 percent in afternoon trading as some investors took profits off the table.

The Chicago Mercantile Exchange (down $2.13 to $549.12, Charts) sweetened its $10 billion offer for CBOT Holdings Inc., the owner of the country's oldest futures exchange by adding a special dividend.

The consumer products firm Colgate-Palmolive Co. (down $0.55 to $66.91, Charts, Fortune 500) warned Thursday that fake toothpaste under the Colgate brand, may contain a poisonous chemical has been found in four states.

Sanofi (down $1.72 to $41.35, Charts) shares tumbled over 3 percent after FDA experts voted against approving its diet drug Zimulti that is trying to win approval in the U.S. market.

Among other movers, blue-chip gains were pretty broad based, with 23 out of 30 Dow stocks rising, led by Alcoa (up $0.68 to $41.16, Charts, Fortune 500), General Motors (up $1.40 to $33.50, Charts, Fortune 500) and Exxon Mobil (up $1.55 to $84.90, Charts, Fortune 500).

Market breadth was positive. On the New York Stock Exchange, winners beat losers 2 to 1 on volume of 1.8 billion shares. On the Nasdaq, advancers topped decliners by 3 to 2 on volume of 1.38 billion shares.