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U.S. stocks surged with major indexes up more than 1 per cent 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 per cent or more in four of the past five sessions, putting it less than 3 per cent from its record close. After a four-week string of declines, the S&P is up 3.5 per cent 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 per cent at $99.61 while 3M added 5.6 per cent to $146.70. The S&P industrial sector climbed 2.4 per cent 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.

On the downside, AT&T Inc fell 3 per cent to $33.47, a day after reporting weaker-than-expected revenue growth. The results pressured the telecom sector, which lost 1.5 per cent as the only one of the 10 primary S&P 500 sectors down on the day.

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.

Dow Jones industrial average rose 238.38 points, or 1.45 per cent, to 16,699.7, the S&P 500 gained 25.94 points, or 1.35 per cent, to 1,953.05 and the Nasdaq Composite added 72.24 points, or 1.65 per cent, 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.

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