US STOCKS-Dow, S&P fall on GDP, but Nasdaq up on biotech

                                
 * US GDP, jobless claims data disappoint investors
                                
 * Exxon Mobil falls after earnings miss expectations
                                
 * Oil drops almost $3 a barrel, lifting sentiment
                                
 * Dow down 0.9 pct, S&P down 0.6 pct, Nasdaq up 0.3 pct
 (Updates to late morning)
                                
 By Walter Brandimarte
                                
 NEW YORK, July 31 (Reuters) - The Dow industrials and the
S&P 500 fell on Thursday after data showing
weaker-than-expected economic growth and a surge in jobless
claims revived fears of an American recession, while Exxon
Mobil's quarterly earnings missed forecasts.
                                
 But the Nasdaq rose after Bristol-Myers Squibb Co <BMY.N>
offered to buy out the remaining stake in biotech partner
ImClone Systems Inc <IMCL.O>. For details, see
[ID:nN31345022].
                                
 ImClone shares leaped 37.3 percent to $63.76 on Nasdaq and
other biotechnology stocks gained on news of the sector's
latest deal.
                                
 Shares of Exxon Mobil Corp <XOM.N> fell 3.1 percent to
$81.73, becoming the biggest drag on the Dow and the S&P 500,
with investors disappointed about the company's
weaker-than-expected production in the second quarter.
[ID:nN31345433]
                                
 The Exxon news, coupled with a drop of $2.82 in the price
of U.S. September crude oil <CLc1> to $123.95 a barrel, hit
the entire energy sector. Shares of ConocoPhillips <COP.N>
lost 2.3 percent to $82.76, while Chevron Corp <CVX.N> fell
1.8 percent to $85.69.
                                
 The U.S. economy grew at a 1.9 percent annual rate in the
second quarter, below the 2.0 percent reading for gross
domestic product forecast by analysts polled by Reuters.
According to another report, the number of U.S. workers filing
new claims for jobless benefits jumped 44,000 last week, above
the Wall Street consensus. [ID:nN31399964]
                                
 But another key indicator showing business activity in the
U.S. Midwest rose unexpectedly in July helped cushion the
market's fall. [ID:nN31482558]
                                
 "The fact that GDP this morning was weak hurt the market,
but we are off the worst levels now. The Chicago purchasing
was a positive surprise, so that helped matters. We may also
be see ing some month-end rebalancing here," said Giri
Cherukuri, head trader at OakBrook Investments LLC, in Lisle,
Illinois.
                                
 The Dow Jones industrial average <.DJI> lost 109.43
points, or 0.95 percent, to 11,474.26, while The Standard &
Poor's 500 Index <.SPX> fell 7.85 points, or 0.61 percent, to
1,276.42. But the Nasdaq Composite Index <.IXIC> gained 7.84
points, or 0.33 percent, to 2,337.56.
                                
 Shares of Walt Disney <DIS.N>, a Dow component, lost 4.5
percent to $30.24 after the company said park bookings were
flat and advertising sales in the current quarter showed some
weakness.
 (Additional reporting by Kristina Cooke; Editing by Jan
Paschal)