By Barbara Kollmeyer, MarketWatch , Ryan Vlastelica

ConocoPhillips rallies, Lululemon tanks

U.S. stocks rose on Thursday as financial shares rallied following a positive reading of economic growth.

The Dow Jones Industrial Average traded was last up 70 points, or 0.3%, at 20,729, with shares of UnitedHealth Group Inc.(UNH), Goldman Sachs Group Inc.(GS), and Wal-Mart Stores Inc.(WMT) leading gainers.

The S&P 500 index traded up 7 points, or 0.3%, to 2,367, with nine out of the index's 11 sectors in the green, led by the financials and industrial sectors.

The Nasdaq Composite Index climbed 17 points, or 0.3%, to 5,914, with the tech-heavy index on track to close at a fresh all-time high and aiming for a fifth straight finish in positive territory.

Following a lackluster start to trading, all three benchmarks have been trading solidly higher.

Earlier, the government said the U.S. economy, as measured by gross domestic product, expanded at a 2.1% annualized pace (http://www.marketwatch.com/story/fourth-quarter-gdp-raised-to-21-corporate-profits-rise-again-2017-03-30) in the fourth quarter, slightly faster than the previously reported 1.9% rate. Separately, jobless claims fell by 3,000 (http://www.marketwatch.com/story/jobless-claims-dip-3000-to-258000-in-late-march-2017-03-30) to 258,000 in the latest week, near their lowest level in decades.

"This is a market that looks like it may be gaining some traction as we go into the end of the month. The upward revision to GDP suggests economic momentum, and that's providing some lift," said Alan Gayle, senior investment strategist at RidgeWorth Investments.

The data helped support financial stocks, which are closely correlated to the pace of economic growth and were the biggest gainers in S&P 500 on the day, up 1.3%. Regional banks in particular enjoyed sharp moves higher, highlighted by a 2.5% gain for Zions Bancorp (ZION) while Regions Financial (RF) was up 2.6%. The SPDR S&P Regional Banking ETF (KRE) popped 3.1%.

With the day's move, the S&P 500 moved into positive territory for March, up 0.2%. The Dow remains down 0.4% for the month, while the Nasdaq is on pace for a 1.5% March return.

Overall, recent gains have been slight, and of the past seven sessions for the S&P 500, not including Thursday, only one has ended with a move greater than 0.2% in either direction. This rangebound trading may be a sign that recent upward momentum on Wall Street may be stalling, even as major indexes continue to trade near records, strategists say.

Muted trading has been the norm since Friday when the Republican-led health-care bill was pulled from the House floor after the White House was unable to overcome resistance from a conservative GOP faction, the House Freedom Caucus. The failure raised questions about Trump administration's ability to pass its economic agenda, which had been seen as market friendly.

With many investors expecting a correction triggered by a policy failure, that lowers the possibility that one such correction will actually happen, seeing that "corrections tend to occur when you least expect them," said Brian Belski, chief investment strategist, at BMO Capital Markets, in a note Thursday.

"Instead, we believe stock prices are likely to bounce back-and-forth in the coming months as investors work through the potential 'negatives' associated with policy rhetoric and the 'positives' of the improving macro and earnings growth environment," Belski said.

"If Congress gets bogged down with its tax and spending plans, as it is often plagued to do, that could leave the market quite vulnerable," Gayle said. "We need to see some tangible progress in the second quarter, otherwise confidence will erode."

Read: Here's what would happen during a government shutdown (http://www.marketwatch.com/story/heres-what-would-happen-during-a-government-shutdown-2017-03-29)

Fed speakers: Cleveland Fed President Loretta Mester forecast GDP growth above 2% in 2017, and sees a "sustained return" to 2% inflation "over the next year or so." Mester also expects the Fed to raise interest rates again this year, but didn't say how many times might be likely. Currently, market participants anticipate three or four hikes in total over 2017.

Stock movers: Cenovus Energy Inc.(CVE) fell 13% after ConocoPhillips (COP) said it would sell the majority its Canadian oil-sands assets to the oil company (http://www.marketwatch.com/story/conocophillips-shares-rally-on-sale-of-oil-sands-interest-to-cenovus-2017-03-29). (http://www.marketwatch.com/story/conocophillips-shares-rally-on-sale-of-oil-sands-interest-to-cenovus-2017-03-29) ConocoPhillips shares were up 7%.

Lululemon Athletica Inc.(LULU) shares tumbled 23% as several analysts cut price-targets on the retailer, which forecast lower profit and sales in the first quarter (http://www.marketwatch.com/story/shares-of-lululemon-tank-as-retailer-calls-for-lower-profit-sales-in-q1-2017-03-29) and missed fourth-quarter earnings expectations.

Apple Inc.(AAPL) traded off between slight gains and losses as the largest U.S. company closed at a record (http://www.marketwatch.com/story/apple-closes-at-yet-another-record-high-2017-03-29)for the second straight day on Wednesday. That was also its sixth record thus far in March.

Read:Tesla now lets you doodle in your car (http://www.marketwatch.com/story/tesla-now-lets-you-doodle-in-your-car-2017-03-29)

Other markets: European stocks finished higher (http://www.marketwatch.com/story/european-stocks-edge-higher-to-flirt-with-2-year-high-2017-03-30), with Germany's DAX reaching its highest close since April 2015. In Asia , equities saw broad losses (http://www.marketwatch.com/story/confused-asian-markets-sag-though-energy-stocks-post-gains-2017-03-29), with the Nikkei 225 index closing 0.8% lower.

Gold prices (http://www.marketwatch.com/story/gold-trades-lower-on-pace-for-3rd-straight-decline-2017-03-30) fell 0.7%, while oil prices (http://www.marketwatch.com/story/oil-prices-make-steady-gains-after-rallying-to-a-three-week-high-2017-03-30) rose 1.6%, with West Texas Intermediate oil trading on the New York Mercantile Exchange moving above $50 a barrel.

The euro extended its decline against the dollar (http://www.marketwatch.com/story/pound-eases-slightly-as-investors-weigh-the-brexit-future-2017-03-30), after a Reuters report that European Central Bank policy makers want to tamp down expectations for their policy announcement in April.

See:Euro bulls just got a wake-up call from the ECB (http://www.marketwatch.com/story/euro-bulls-just-got-a-wake-up-call-from-the-ecb-2017-03-30)

--Barbara Kollmeyer in Madrid contributed to this article.

 

(END) Dow Jones Newswires

March 30, 2017 14:04 ET (18:04 GMT)

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