Wall Street shrugged as crude oil futures hit an all-time high of $58.60 per barrel, before settling at $58.47, up $1.89, on the New York Mercantile Exchange. An increase in demand and worries about global refining capacity drew heightened speculation in the oil market.

But some analysts said rising oil prices weren't cause for alarm on Wall Street, as higher energy costs haven't made a dent in corporate profits.

"Companies can make money, and plenty of it, with oil at these levels," said Scott Wren, senior equity strategist at A.G. Edwards & Sons. "We've had oil near these levels for nearly two quarters and companies have continued to knock the ball out of the park, beating consensus earnings estimates."

The Dow Jones industrial average rose for the seventh straight session, gaining 44.42, or 0.42 percent, to 10,623.07.

Broader stock indicators also advanced. The Standard & Poor's 500 index moved back into positive territory for the year for the first time since March 9, gaining 6.00, or 0.5 percent, to 1,216.96. The Nasdaq composite index gained 0.96, or 0.05 percent, to 2,090.11.

Bonds were nearly flat, with the yield on the 10-year Treasury note at 4.08 percent, up from 4.07 percent late yesterday. The U.S. dollar fell against other major currencies. Gold prices rose, heading for their fourth weekly gain.

Despite surging oil prices, the market consistently scratched out small gains this week as the Labor Department reported declines in both wholesale and retail prices, easing Wall Street's fears of inflation. For the week, the Dow gained 1.05 percent, the S&P rose 1.57 percent, and the Nasdaq was up 1.31 percent.

Jay Suskind, head trader at Ryan Beck & Co., called the recent run "a stealth rally," saying that while the indexes advanced, the light volume through much of the week showed that many investors remained on the sidelines before the Federal Reserve's Open Market Committee meeting at the end of the month and second-quarter earnings season in July.

Today's trading was bolstered by the University of Michigan's consumer sentiment index, a widely watched barometer of consumers' confidence in the economy, which came in at 94.8, a much higher reading than the 88.8 Wall Street expected.

And the Commerce Department released its measure of the first-quarter current account deficit. The broadest measure of foreign trade, which hit a record, grew 33 percent from a year ago, rising to $195.1 billion.

It was a "quadruple witching day" on Wall Street, in which investors cash in quarterly options and futures contracts, written on equities and the major indexes, and buy new ones, which likely accounted for some of the rise in stock prices. Increased volatility and widely varying stock prices and high volumes often accompany such days.

By the close, 1.93 billion shares changed hands on the New York Stock Exchange, versus 1.36 billion yesterday.

Guidant Corp. said the U.S. Food and Drug Administration will recall more than 38,000 of its implanted cardiac defibrillators because of potential malfunctions. Its stock dropped $1.20 to $72.46. Shares in Johnson & Johnson, which has agreed to purchase the company in a deal awaiting regulatory approval, rose 26 cents to $66.56.

Bank of America Corp. said it reached a $3 billion deal to buy a 9 percent stake in China Construction Bank. The deal would be the largest single purchase of stock in a Chinese bank by a foreign financial institution. Bank of America added 21 cents to $46.64.

Morgan Stanley is reassessing its plan to spin off its Discover unit, according to a report in the Wall Street Journal. The card generates just under a fifth of the company's pretax net income. The stock was down 52 cents at $51.38.

Adobe Systems Inc. reported better-than expected second-quarter results after regular trading yesterday, but analysts were disappointed with what they saw as conservative forecasts from the company, which dropped $1.07 to $31.34.

Electronics retailer Circuit City Stores Inc. was down 72 cents at $16.93 after the company reported a wider-than expected first-quarter loss.

Advancing issues outnumbered decliners by more than 9 to 5 on the NYSE.

The Russell 2000 index of smaller companies was up 0.16, or 0.02 percent, at 644.19.

Overseas, Japan's Nikkei stock average closed 0.86 percent higher. Britain's FTSE 100 was up 0.65 percent, Germany's DAX index was up 0.54 percent, and France's CAC-40 was up 0.85 percent.