(CNBC) U.S. stocks closed sharply higher Friday as oil prices rose and investors took a more positive view of Thursday’s European Central Bank announcements on stimulus.

“The monetary policy tools we believe are effective are being expanded and the monetary policy tools we don’t believe to work are being limited,” said Art Hogan, chief market strategist at Wunderlich Securities.

Also supporting gains in stocks was a rise in oil following the International Energy Agency’s report that said oil might have bottomed. Baker Hughes data showed U.S. rigs declined by six.

U.S. crude oil futures settled up 66 cents, or 1.74 percent, at $38.50 a barrel.

The major U.S. averages traded more than 1 percent higher in afternoon trade, on pace for their fourth-straight week of gains since November.

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