NEW YORK (TheStreet) -- Energy stocks said goodbye to short-lived highs achieved over the session as crude oil closed below $60 a barrel for the first time since July 2009. West Texas Intermediate slid more than 1% to $59.85 after plummeting 5% on Wednesday as OPEC cut demand forecasts for 2015. 

The Energy Select Sector SPDR ETF (XLE) climbed 0.09%, paring gains of over 2% earlier in the session. Mid-cap oil explorers and drillers were among the hardest hit with Transocean (RIG) down 1.9% and Nabors Industries (NBR) falling 2.4%. 

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Retail stocks were leading benchmark indices higher after an unexpected jump in November consumer spending presented the silver lining of crashing crude prices.

Though down from session highs, the S&P 500 remained 0.57% higher, the Dow Jones Industrial Average added 0.51% and the Nasdaq popped 0.73%.

The SPDR S&P Retail ETF XRT rose 1.3%. Urban Outfitters (URBN) , the best performer on the S&P, climbed 7.8% following a Securities and Exchange Commission filing in which the retailer disclosed fourth-quarter comparable sales in the low-single digits after a negative result in its third quarter.

Lululemon (LULU) added 9.3% after beating third-quarter earnings estimates, though gains were restricted as operating margins were pressured. Staples (SPLS) and Office Depot (ODP) were spiking after activist investor Starboard Value substantially raised its stake in both, a move which could put pressure on the companies to merger, The Wall Street Journal reported.

Overall retail sales climbed 0.7% in November, its largest gain since March, compared to forecasts for a 0.4% increase. Core retail sales, excluding automobiles, gasoline and food services, rose 0.6%.

Increased consumer spending in November validated what economists assured traders would happen since a crash in crude oil sparked broad market selloffs: lower gasoline prices would fuel consumer confidence to spend, a more important measure of economic health given consumer spending contributes more than two-thirds of GDP. The National Retail Federation reaffirmed its 4.1% growth forecast for the holiday season. 

"This is the first tangible sign that lower oil prices are supporting the consumer," said Anthony Valeri, investment strategist for LPL Financial, in a call. "The U.S. consumer obviously got the holiday shopping season off to a strong start... From our calculations consumer spending has begun the fourth quarter at the same pace as the third quarter so it's consistent with GDP growth of around 3%."

Weekly jobless claims slipped to 294,000, slightly lower than forecast. The weekly measure fuels further confidence in a tightening job market after nonfarm payrolls for last month came in at a three-year high with 321,000 U.S. jobs added.

Delta Air Lines (DAL) climbed 4.5% after the airline said it expects pretax income to increase to $5 billion next year as a result of the drop in oil prices. Airlines extended Wednesday's rally with United Continental (UAL) , Southwest Airlines (LUV) and American Airlines (AAL) each higher.

eBay (EBAY) added nearly 4% after the Wall Street Journal reported the online auction company is considering a plan to cut at least 3,000 jobs, or 10% of its workforce, next year.

Walgreen (WAG) shares advanced 5.6% after CEO Greg Wasson announced his retirement, effective once the company's merger with Alliance Boots is completed.

Shares of pharmaceutical giant Eli Lilly (LLY) was gaining after Morgan Stanley upgraded the company to "overweight" as analysts praised management for making profitable pipeline investments. Ariad Pharmaceuticals (ARIA) was falling after being downgraded to "underperform" by Credit Suisse. Analysts said the company had shown weak launch metrics for new drugs.

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-- Written by Keris Alison Lahiff in New York.