NEW YORK (TheStreet) -- The S&P 500 was on track to close at record highs by the final hour of trading Thursday as a rally in the energy sector boosted the benchmark index.
The S&P 500 was up 0.29% to 2,131.9, above its May 18 record of 2,129. The Dow Jones Industrial Average rose 0.11%, and the Nasdaq added 0.4%.
Crude oil added to Wednesday's gains as commodity traders bet the latest weak data out from China would encourage the People's Bank of China to introduce further monetary stimulus. The HSBC China Manufacturing Purchasing Managers Index increased to 49.1 in May, up from 48.9 in April though it remained under 50 which signals contraction.
Also boosting commodity markets, the Energy Information Administration reported Wednesday a fall of 2.7 million barrels in crude supplies for the week ended May 15. Analysts had expected a drop of 2 million barrels. West Texas Intermediate added closed 3% higher to $60.72 a barrel.
BP (BP) was more than 1% higher after settling with Halliburton (HAL) and Transocean (RIG) over claims related to the 2010 Gulf of Mexico oil spill. Transocean will get $125 million compensation for legal claims, though will have to pay nearly double that into a fund compensating victims of the spill. Transocean gained 3.7% while Halliburton climbed 2.7%.