* Oil prices jump about 5 pct
* Gap sinks after poor March same-store sales
* Indexes up: Dow 0.63 pct, S&P 0.68 pct, Nasdaq 0.50 pct (Adds details, changes comment, updates prices)
By Yashaswini Swamynathan and Abhiram Nandakumar
April 8 (Reuters) - A strong rebound in oil pushed U.S. stocks higher on Friday, while investors took comfort in Federal Reserve Chair Janet Yellen’s positive comments on the economy.
Crude jumped more than 6 percent on rising hopes that top producers would agree to freeze output and positive economic indicators in the United States and Europe hinted at an increase in demand.
Yellen said on Thursday the U.S. economy was on a solid course with some hints of inflation, putting the central bank on track for a gradual increase in interest rates this year.
New York Fed President William Dudley said a cautious and gradual approach to raising rates was appropriate, given lingering external risks to the U.S. economy.
U.S. stocks have been volatile through the week, with the S&P 500 down 1.5 percent, as investors fretted over a cloudy outlook on rates and signs of weakness in the global economy.
“The market’s been directionless all week and there hasn’t been any clear trend to speak of,” Neil Massa, senior trader at John Hancock Asset Management in Boston.
“Right now, crude being up is helping the market go up.”
Investors will now focus on the upcoming corporate earnings season. Profits at S&P 500 companies are expected to have declined 7.4 percent in the first quarter, according to Thomson Reuters data.
At 10:57 a.m. EDT the Dow Jones industrial average was up 110.19 points, or 0.63 percent, at 17,652.15, the S&P 500 was up 13.84 points, or 0.68 percent, at 2,055.75 and the Nasdaq Composite was up 24.13 points, or 0.5 percent, at 4,872.50.
All 10 major S&P sectors were higher, led by a 2.36 percent rise in the energy sector. Chevron shares rose 1.8 percent to $96.48, while Exxon was up 1.1 percent $83.30.
Boeing was up 2 percent at $129.64, giving the biggest boost to the Dow. The company on Thursday said it had booked four orders for its 747-8 freighter, the first sales of the year for the plane.
Depomed was up 12 percent at $16.88 after investor Starboard criticized the drugmaker’s board and urged it to explore a potential sale.
Gap shares were down 9.5 percent at $25.11 after the company’s poor same-store sales for March prompted Citigroup to cut its price target on the stock.
Advancing issues outnumbered decliners on the NYSE by 2,487 to 406. On the Nasdaq, 1,834 issues rose and 761 fell.
The S&P 500 index showed 13 new 52-week highs and one new low, while the Nasdaq recorded 16 new highs and nine new lows. (Reporting by Yashaswini Swamynathan and Abhiram Nandakumar in Bengaluru; Editing by Anil D‘Silva)