NEW YORK (Reuters) - U.S. stocks surged on Thursday, with major indexes up more than 1 percent in a broad rally, as strong results from industrial bellwethers reassured investors that corporations continue to fare well despite concerns about global economic growth.
The advance continued a recent bout of strength for equities. The S&P 500 has posted a gain of 0.9 percent or more in four of the past five sessions, putting it less than 3 percent from its record close. After a four-week string of declines, the S&P is up 3.5 percent this week, on track for its biggest weekly advance since January 2013.
Shares of both Caterpillar Inc and 3M Co rose following their results. Caterpillar, which also raised its full-year profit view, was up 5.3 percent at $99.61 while 3M added 5.6 percent to $146.70.
The S&P industrial sector <.SPLRCI> climbed 2.4 percent as the biggest advancing sector on the day.
"It's good to see good numbers in any company, but if we're looking at headwinds like currency and slowing global growth, seeing multinationals like Caterpillar and 3M post solid beats gives us confidence that economic growth is holding on and probably better than the market is currently expecting," said Phil Orlando, chief equity market strategist at Federated Investors in New York.
On the downside, AT&T Inc fell 3 percent to $33.47, a day after reporting weaker-than-expected revenue growth. The results pressured the telecom sector <.SPLRCL>, which lost 1.5 percent as the only one of the 10 primary S&P 500 sectors down on the day.
Yelp Inc slumped 15 percent to $59.40 in heavy trading a day after giving a revenue outlook that was below expectations. Many analysts cut their price targets on the stock.
This season has largely been positive for companies. With 35 percent of the S&P 500 having reported, 69.5 percent have exceeded profit expectations, according to Thomson Reuters data, above the long-term average of 63 percent.
New claims for U.S. unemployment benefits held below 300,000 for a sixth straight week last week, suggesting the labor market was shrugging off jitters over a slowing global economy.
At 12:55 p.m., the Dow Jones industrial average <.DJI> rose 238.38 points, or 1.45 percent, to 16,699.7, the S&P 500 <.SPX> gained 25.94 points, or 1.35 percent, to 1,953.05 and the Nasdaq Composite <.IXIC> added 72.24 points, or 1.65 percent, to 4,455.08.
Advancing issues outnumbered declining ones on the NYSE by 2,467 to 541, for a 4.56-to-1 ratio; on the Nasdaq, 2,050 issues rose and 579 fell for a 3.54-to-1 ratio.
The benchmark S&P 500 index was posting 39 new 52-week highs and 2 new lows; the Nasdaq Composite was recording 48 new highs and 32 new lows.
(Additional reporting by Ryan Vlastelica; Editing by Nick Zieminski and Bernadette Baum)Copyright © 2014, The Baltimore Sun