It was the highest close for the Dow since May 19, 2008, four months before the worst of the financial crisis. As the Dow moved to within sight of 13,000, applause broke out at the closing bell on the floor of the New York Stock Exchange.
The Standard & Poor's 500 rose 14.81 points, to 1,358.04, its highest close in 9 1/2 months. The Nasdaq composite, which has had an even stronger year than the Dow and S&P and is trading at its highest since 2000, rose 44.02 points to 2,959.85.
The rally was broad, with all but one of the 30 stocks in the Dow - Kraft Foods Inc. - closing higher. All 10 industry groups in the S&P were comfortably higher, led by materials stocks, including strong showings from DuPont Co. and Dow Chemical Co.
For GM, which was rescued and reconstituted through bankruptcy and a government bailout two years ago, the quick turnaround was surprising. Leaner and smarter under new management, it cut costs by taking advantage of its size around the globe. And its new products boosted sales so much that it has reclaimed the title of world's biggest automaker from Toyota.
But General Motors may have a hard time breaking this record in 2012 because it is losing money in Europe and South America, and U.S. sales growth slowed in the last three months. But the company's performance in North America and Asia still helped it earn $7.6 billion for the year.
Elsewhere, the Labor Department said weekly applications for unemployment benefits dropped for the fourth time in five weeks to the lowest point since March 2008.
Construction of single-family homes cooled slightly in January, but a rise in permits suggested builders were growing more confident that buyers are ready to come off the sidelines.
The market has seemed determined to move higher this year, despite mostly incremental and vague news about the progress in stemming the Greek debt and sometimes-conflicting reports on the U.S. economy.
Analysts cautioned that there could be volatility ahead for the market.
Gasoline prices could be a threat for the U.S. economy, particularly as Iran threatens to cut exports. The average price for a gallon of gasoline is $3.52, the highest on record this time of year, and could climb to $4.25 a gallon by late April.
But others thought the positive jobs and housing reports would continue to be what sways the market.
The Greek situation plodded along Thursday without any certainty of moving forward. The difference this time was that investors did not seem to care. European finance ministers will discuss the Greek bailout at a meeting Monday.
Greece is negotiating for breaks on loans due next month in addition to the bailout, which would be aimed at preventing a bankruptcy that could send a shock through the world financial system.