Traders Cheer Economic Growth

An unexpected upward revision to third-quarter economic growth eased slowdown fears Wednesday and sent stocks surging higher.

News that the economy grew 2.2% in the third quarter, revised from an initial reading of 1.6%, and an improving picture in the Fed’s Beige Book economic survey gave investors a reason to buy.

Analyst upgrades to Intel and Verizon also helped stocks recover much of Monday’s losses and boosted tech stocks to a 0.8% gain on the day.

Retail sales reports on Thursday will be closely watch for insight into the strength of holiday spending.

3Com fell 10% after buying out joint venture partner Huawei.

VA Software and Sigma Designs surged on their results, while Opsware fell 5% on its earnings.

The Nasdaq gained 19 to 2432, the S&P 500 surged 12 to 1399, and the Dow rose 90 to 12,226. Volume rose to 2.79 billion shares on the NYSE, but declined to 1.97 billion on the Nasdaq. Advancers led 26-6 on the NYSE, and 21-9 on the Nasdaq. Upside volume was 80% on the NYSE, and 71% on the Nasdaq. New highs-new lows were 291-16 on the NYSE, and 149-47 on the Nasdaq.

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