It was another unpredictable day on Wall Street.
Stocks wavered between a much-needed rally and slight losses for much of the session before settling higher.
The S&P 500 was up 0.52%, the Dow Jones Industrial Average added 0.74%, and the Nasdaq was flat.
Stocks edged further from a bear market, though remained in correction territory, with the S&P 500 down 12.4% from 52-week highs and the Dow having fallen 13.5%.
"It's a classic tug of war between good news and bad news," Mike Baele, managing director at the Private Client Reserve at U.S. Bank, told TheStreet on the current market mood.
On the one hand, the U.S. economy continues to show resilience in the face of a global slowdown with the labor and housing markets particular paragons of strength.
On the other, fears over oil prices and China have stuck around for the start of the year to encourage investors to unload positions. Fears over the former eased, at least for Thursday, as prices rocketed higher in a long overdue rally after days at 12-year lows. West Texas Intermediate closed above $29 a barrel after a weekly read on crude inventories rose less sharply than expected.
"It seemed like oil has really entered an oversold situation," said Baele. "There has been demand growth and it is always a bigger issue if you have a demand problem than a supply problem. At these levels it's highly likely we'll see a supply response" such as oil producers cutting production.
The energy sector was the best performer on markets. Major oilers including Exxon Mobil (XOM) , Chevron (CVX) , ConocoPhillips (COP) and Shell (RDS.A) were all higher, while the Energy Select Sector SPDR ETF (XLE) added 3%.
But the doom and gloom over global markets that has overshadowed markets so far this year kept trading interesting on Thursday with markets starting the day in the red and briefly falling to the flatline during the session. Some argue the worries over China will keep trading erratic in the short term.
"It is difficult in the very short term to see a catalyst to calm China fears, many of those concerns surrounding a potential sharp currency devaluation," said John Canally, Chief Economic Strategist for LPL Financial. "We do expect supportive Chinese fiscal and monetary policy moves to help eventually, on the margin, but it is unclear how long that will take and how much impact they will have."
The European Central Bank helped sentiment after President Mario Draghi struck a dovish tone, noting that additional stimulus might be needed in response to current events, including new lows in crude oil prices since the organization's December meeting. The ECB president also said Thursday that the impact of the ECB's current stimulus program has been "significant, if not spectacular." The ECB left interest rates unchanged following its meeting Thursday morning.
"The nod to the potential for interest rates to go 'lower,' repeated comments about 'downside risks' increasing, and most importantly, the explicit comment that the central bank would 'reconsider' its monetary policy stance in March all support the dovish view," Matt Weller, senior market analyst at FOREX.com, wrote in a note.
IBM (IBM) climbed 1% after agreeing to acquire video streaming company Ustream as it boosts its corporate video services. The tech company said the new acquisition will appeal to corporate clients looking to produce video for purposes such as marketing and webinars. No financial amount was disclosed.
It was a busy day on the earnings calendar. Verizon (VZ) added 3.3% after reporting adjusted earnings of 89 cents a share, a penny above estimates. The telecom giant said it added 99,000 Fios Internet customers in the fourth quarter.
Kinder Morgan (KMI) climbed 15% despite reporting an unexpected quarterly loss in the face of a collapsing commodity market. The company reported a loss of 29 cents a share on revenue of $3.64 billion. Analysts were expecting earnings of 18 cents a share on $3.9 billion in revenue.
Deutsche Bank (DB) tumbled 4% after announcing it expects an annual loss of 6.7 billion euros ($7.3 billion) for 2015, compared with a net profit of 1.69 billion euros the previous year. Germany's largest bank blamed the wider-than-expected loss on further litigation charges. Deutsche Bank will report earnings at the end of the month.