* GDP turns positive in Q3, fuels recovery hopes
* P&G and Colgate beat profit views, Exxon misses
* Dow up 2.1 pct; S&P 500 up 2.3 pct, Nasdaq up 1.8 pct
* For up-to-the-minute market news, click []
(Updates to close)
By Ellis Mnyandu
NEW YORK, Oct 29 (Reuters) - U.S. stocks logged their best
one-day percentage gain in three months on Thursday as
investors saw data showing the U.S. economy returned to growth
in the third quarter as brightening the outlook for profits.
The government's first estimate of U.S. gross domestic
product showed the economy expanded at an annual rate of 3.5
percent in the third quarter, suggesting it was emerging from
the worst recession in 70 years. The quarter of growth was the
first after more than a year of contraction in GDP. For
details, see []
Equity gains were widespread, with big manufacturers,
technology, financials, energy and the materials sectors all
benefiting. Both the S&P 500 and the Nasdaq halted a four-day
rout.
Sentiment was also boosted by stronger-than-expected
quarterly results from consumer product heavyweights Procter &
Gamble Co <PG.N> and Colgate-Palmolive Co <CL.N>.
The GDP report served as more affirmation of investors'
recent bets on the recovery, which fueled a sharp advance from
the 12-year lows of early March.
"We see today that the optimism about corporate earnings
reports is just being confirmed in the GDP report," said
Kenneth Kamen, president of Mercadien Asset Management in
Hamilton, New Jersey. "We are starting to see the economy
really recover and GDP picking up."
The Dow Jones industrial average <> gained 199.89
points, or 2.05 percent, to 9,962.58. The Standard & Poor's
500 Index <.SPX> jumped 23.48 points, or 2.25 percent, to
1,066.11 -- marking its biggest one-day percentage gain in
three months. The Nasdaq Composite Index <> shot up 37.94
points, or 1.84 percent, to close at 2,097.55.
Weakness in the U.S. dollar also underpinned Thursday's
stock action as the appetite for riskier assets resurfaced.
Economists in a Reuters poll last week expected GDP to
gain 3.3 percent, although some recent data led many to trim
forecasts this week.
Shares of Dow component P&G, which also raised its
full-year revenue outlook, gained 4 percent to $59.54, while
Colgate-Palmolive shares rose 1.6 percent to $78.94. The S&P
consumer staples index <.GSPS> gained 1.8 percent.
[]
Caterpillar Inc <CAT.N>, whose products include bulldozers
and excavators, rose 5.2 percent to $57.25, as shares of
aircraft maker Boeing Co <BA.N> rose 3.4 percent to $48.81.
iPhone maker Apple Inc <AAPL.O> rose 2.1 percent to
$196.35 on Nasdaq, where Symantec Corp <SYMC.O> jumped 12.8
percent to $17.74, a day after the business software maker
posted a quarterly profit that eclipsed Wall Street's
forecasts.
Several brokerages raised price targets on Symantec.
Higher oil prices contributed to the energy sector's
gains, with the S&P energy index <.GSPE> up 2.4 percent.
Chevron Corp <CVX.N> gained 2.7 percent to $77.95 ahead of its
quarterly results on Friday.
Exxon Mobil Corp <XOM.N> edged up 0.2 percent to $73.96,
but the stock spent most of the session in negative territory
following the company's report of a third-quarter profit below
expectations. []
Even with the optimism inspired by the latest GDP report,
other money managers said there was still reason to be
cautious as the recovery might prove bumpy.
"We are in the early stages of a recovery process," said
Les Satlow, portfolio manager at Cabot Money Management in
Salem, Massachusetts. "It's a very good thing that GDP is
growing quarter-on-quarter, but if this is a V-shaped recovery
we are still well below the top left of the V."
Data from the Labor Department showed that the number of
U.S. workers filing new claims for jobless benefits fell last
week, though not by as much as expected. []
The S&P 500 is up 57.6 percent from its 12-year closing
low of March 9. It has shed 2.9 percent from its post-March
peak of Oct. 19, however.
(Editing by Jan Paschal)
