NEW YORK — The stock market's rally is shifting to a lower gear.

Investors welcomed a drop in jobless claims, growth in retail sales and better-than-expected demand at a government debt auction. But traders also seemed mindful of how far the market has come in its three-month rally.

The stock market has at times run low on fresh evidence of economic recovery that could push the rally further. The data out yesterday helped but weren't enough to keep the pace of buying strong through the end of trading.

Doug Lockwood, chief investment officer at Cornerstone Wealth Management, said the improvements in sales is a strong signal that the recession may be easing. Hope of a recovery has pushed the S&P 500 index up 39.7 percent from a 12-year low on March 9.

"There has been a lot of rallying and rebounding going on, but we have to continue to see improvements," he said.