YAHOO [BRIEFING.COM]: Stocks put together their best single-session performance in three months as participants responded positively to a drop in oil prices and some encouraging economic data.

Reports that Libya's Gaddafi accepted a peace plan put forth by Venezuela's Chavez failed to pacify protestors, but it was enough to put pressure on oil prices this morning. Oil prices never dipped below $100 per barrel, though, and eventually pared their losses to finish pit trade with a relatively tame 0.3% loss at $101.91 per barrel.

Although oil recouped part of its loss, stocks held steady to strong gains as data helped bolster buying interest.

Initial jobless claims for the week ended February 26 totaled 368,000, which is less than the 400,000 that had been expected, on average, among economists polled by Briefing.com. Given that the latest initial claims tally was less than 400,000 for the third time in four weeks and yesterday's ADP Employment Change proved better than expected, there is some optimism ahead of tomorrow's February nonfarm payrolls report. Nonfarm payrolls increased by 36,000 in January, but the Briefing.com consensus calls for an addition of 185,000 in February.

The ISM Services Index for February also proved impressive. The consensus among economists polled by Briefing.come had called for a reading of 59.0, but it climbed to 59.7, which makes for the best reading since 2005. In contrast, China's PMI Non-Manufacturing Index fell to a two-year low of 44.1 in February and the eurozone PMI Services Index for February slipped to 56.8 from the prior reading.

Action overseas was generally upbeat, but France's CAC and Germany's DAX saw their gains halved. News that eurozone GDP increased by 0.3% in the fourth quarter didn't have any dramatic impact on trade, but buying interest dwindled after the European Central Bank (ECB) President Trichet issued hawkish comments despite the fact that the ECB left its target interest rate unchanged at 1.00%, as had been expected. Trichet's comments helped the euro ascend 0.7% so that it now trades at $1.396.

Corporate news played little part in today's trade. Retailers were out with their latest same-store sales results, but the numbers were really rather mixed. Still, the group was able to ride the broader market's climb to a 1.2% gain.

Stocks with the most sensitivity to oil prices staged the strongest gains. For example, airlines collectively advanced 2.4% while transportation stocks climbed 2.5%.

Telecom trailed, though. It mustered a mere 0.2% gain. Telecom remains the only major sector that is still in the red year to date -- it has lost 2.7% so far this year.

Another mixed session for commodities. Grains (+1.6%) led all gainers, while precious metals (-1.6%) led all decliners.

April gold shed 1.4% to close at $1417.50 per ounce, while May silver ended off 1.4% to $34.33 per ounce. Both metals sold off in overnight trade on reports that that the Arab League was considering a peace plan mediated by an ally of Muammar Gaddafi, Venezuelan President Hugo Chavez. Weakness in the precious metals was further compounded by commentary from ECB Head Jean Paul Trichet, when he said that a change of rate in the next ECB meeting is possible.

Headlines surrounding events in Libya kept trade in April crude oil, which settled lower by 0.3% to $101.91 per barrel, somewhat volatile today. Skepticism over the substance of mediation offered by Chavez kept prices relatively close to the flat line throughout the session. Crude did sell off to lows, at $102.39, in early afternoon trade, but managed to retrace that selloff to finish with only modest losses. March natural gas closed lower by 1.1% to $3.77 per MMBtu, extending its selloff to a third consecutive session. Today's lows, at $3.76, mark natural gas' worst since mid-Nov of 2010.

Advancing Sectors: Industrials (+2.4%), Financial (+2.2%), Materials (+2.0%), Health Care (+2.0%), Tech (+1.7%), Consumer Discretionary (+1.7%), Energy (+1.5%), Consumer Staples (+1.1%), Utilities (+1.0%), Telecom (+0.2%)
Declining Sectors: (None)DJ30 +191.40 NASDAQ +50.67 SP500 +22.53 NASDAQ Adv/Vol/Dec 2027/2.00 bln/608 NYSE Adv/Vol/Dec 2451/1.07 bln/547