Oil falls and U.S. stocks rally led by tech

By Herbert Lash

NEW YORK (Reuters) - Oil prices fell from record highs and Wall Street stocks rose on Thursday in a tech-led rally prompted by a profit forecast at bellwether Apple as investors bet on an improving U.S. economy by year's end.

The dollar reversed losses versus the euro after an early surge to record highs by the euro zone's single currency, and gold prices fell after a 10-day high early in the session.

Bond prices initially rose following government reports on U.S. trade and jobless claims that reinforced the belief the United States is slipping into recession. But they later reversed course and fell.

Crude oil fell from a new record in London as top exporter Saudi Arabia insisted markets were amply supplied despite falling U.S. inventories, and the Saudi oil minister said the Kingdom did not plan to change current output.

Wall Street's broad rally somewhat offset losses in overseas stock markets, and turned bond prices on the notion a U.S. slowdown will not be as deep as some have expected.

A shallow recession, if it does occur, will prove positive for corporate earnings and the stock market, analysts said.

Gains in technology bellwethers Intel, Cisco, IBM and Apple were among the biggest contributors to the benchmark Standard & Poor's 500 Index.

"If you're optimistic about growth in the second half, then what is tied to growth and most successful in times of growth? Technology," said Marc Pado, U.S. market strategist at Cantor Fitzgerald & Co.