NEW YORK—The stock market notched its second straight daily advance Thursday, with investors assuaged by a pullback in oil prices and some better-than-expected economic data.

Wall Street has been worried about cash-strapped consumers paring back their spending, so it was pleased that the energy markets gave up early gains that briefly drove crude oil above $125 a barrel.

In other positive signs, the Philadelphia Federal Reserve said regional manufacturing activity is contracting in May at a much slower pace than in April, while major companies including General Electric...