By Abhiram Nandakumar
REUTERS - U.S. stocks surged higher late on Thursday morning as oil prices rallied and ECB President Mario Draghi raised hopes of easing monetary policy further as soon as March.
The European Central Bank kept its main rates on hold and Draghi said the central bank would "review and possibly reconsider" its monetary policy stance in March. Many analysts had not expected a rate cut before June.
Oil prices recovered from earlier losses and were sharply higher. [O/R]
The Draghi-led rally comes a day after a rout in global stocks, spurred by the relentless drop in oil prices and fears of a China-led slowdown in global growth.
A volatile session on Wall Street on Wednesday ended with the S&P 500 closing at its lowest since October 2014, with many stocks hitting new 52-week lows.
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Some investors, however, expect the market to stabilize as stock valuations are reassessed and bargain-hunters step up.
"Some of the selling will exhaust itself pretty soon. This sort of market will create opportunities," said Chris Bertelsen, chief investment officer at Global Financial Private Capital in Sarasota, Florida.
"Every time there is a snapback, the drawdown is greater than the snapback and that is a sign that presages a market where people hunt for safety stocks and higher yield," he added.
At 11:06 a.m. ET (1606 GMT), the Dow Jones industrial average was up 165.9 points, or 1.05 percent, at 15,932.64.
The S&P 500 was up 18.09 points, or 0.97 percent, at 1,877.42 and the Nasdaq Composite index was up 36.47 points, or 0.82 percent, at 4,508.16.
Eight of the 10 major S&P sectors were higher, led by a 2 percent rise in the telecom sector.
Verizon gave the biggest boost to the sector, rising 2.7 percent to $45.60 after reporting a better-than-expected quarterly profit.
Union Pacific was down 6.3 percent at $69.02 after the railroad operator warned of a weak 2016. The report weighed on other railroad stocks.
Xilinx jumped 10.4 percent to $47.55 after the chipmaker's quarterly revenue beat expectations.
Advancing issues outnumbered decliners on the NYSE by 2,094 to 845. On the Nasdaq, 1,614 issues rose and 980 fell.
The S&P 500 index showed no new 52-week highs and five new lows, while the Nasdaq recorded two new highs and 51 new lows.
(Reporting by Abhiram Nandakumar in Bengaluru; Editing by Savio D'Souza)