NEW YORK (TheStreet) -- Stocks held onto modest gains in the final hour of trading after the Federal Reserve provided an upbeat assessment of the U.S. economic recovery.
The economy rebounded at a modest to moderate pace over the period from early April to late May, according to the Fed's Beige Book, an anecdotal collection of economic conditions across the 12 districts. Consumer spending, a key GDP component that has lagged in recent months, appeared on the rebound as the metric increased in 10 of the 12 districts.
However, the energy downturn continued to hurt manufacturing growth with drilling declines in five districts, including Dallas and Kansas City, the central bank said.
The S&P 500 was up 0.38%, the Dow Jones Industrial Average rose 0.55% and the Nasdaq added 0.55%.
Crude oil prices dropped nearly 3% and gave up a level above $60 a barrel ahead of Friday's meeting of the Organization of the Petroleum Exporting Countries. The group is expected to maintain current record production levels despite global oversupply.
"The OPEC stance is currently believed to be one of maintaining the 30 million barrel a day production level, which means the expectation of additional Iranian output is yet another bear in the market - currently oversupplied by 2.5 million barrels a day," said Daniel Holder, commodity analyst at Schneider Electric.
West Texas Intermediate settled at its lowest level in a week, down 2.6% to $59.64, though remained around $20 higher than a January low.
European Central Bank President Mario Draghi said in a press conference that eurozone inflation had "bottomed out" at the beginning of the year due to monetary policy, falling oil prices and a weaker euro. The ECB raised consumer inflation forecasts to 0.3% for the full year, up from a previously expected flat reading.