* U.S. crude settles down; energy shares near flat
* Initial claims point to strengthening labor market
* Oracle up after results
* Indexes up: Dow 1.6 pct, S&P 1.7 pct, Nasdaq 1.8 pct (Updates to late afternoon)
By Caroline Valetkevitch
NEW YORK, Dec 18 (Reuters) - U.S. stocks advanced more than 1 percent on Thursday, extending a rally from the previous session as tech shares gained with stronger-than-expected results from Oracle.
The technology sector, up 2.4 percent, helped fuel the advance, buoyed by a gain of over 8 percent in Oracle Corp , a day after its quarterly results topped Wall Street expectations. Shares of Apple climbed 1.9 percent.
On Wednesday, the benchmark S&P 500 index had notched its best day since October 2013 after the Federal Reserve gave an upbeat assessment of the U.S. economy and said it would take a patient approach toward raising interest rates.
The S&P 500 had fallen nearly 5 percent from its most recent record high on Dec. 5 before the strong gains on Wednesday.
WTI crude fell 4.2 percent, while the S&P Energy sector was last up 0.1 percent.
At 2:35 p.m., the Dow Jones industrial average rose 287.83 points, or 1.66 percent, to 17,644.7, the S&P 500 gained 31.95 points, or 1.59 percent, to 2,044.84 and the Nasdaq Composite added 81.18 points, or 1.75 percent, to 4,725.49.
Earlier in the session, data showed weekly jobless claims fell more than expected, suggesting the labor market continues to strengthen. However, readings on the U.S. services sector and mid-Atlantic factory activity indicated a slower pace of growth.
Rite Aid shares surged 12.2 percent to $6.80 after the drugstore chain's quarterly results topped expectations and it boosted its 2015 outlook.
Advancing issues outnumbered decliners on the NYSE 2,370 to 722, for a 3.28-to-1 ratio; on the Nasdaq, 1,969 issues rose and 760 fell for a 2.59-to-1 ratio.
The benchmark S&P 500 was posting 60 new 52-week highs and five new lows; the Nasdaq Composite was recording 133 new highs and 28 new lows. (Additional reporting by Charles Mikolajczak; Editing by Bernadette Baum and Nick Zieminski)