Stocks surge on earnings and economic data; Dow climbs 500

NEW YORK (AP) — World stock markets are rallying today, and U.S. stocks are on track for their second-largest gain in 2018 after strong earnings reports from major U.S. companies in finance and health care.

Technology companies are also rising after their recent slump. The Dow Jones Industrial Average rose as much as 502 points.

Even with the big gains, major indexes are still broadly lower for the month after a two-day rout last week that erased nearly 1,400 points from the Dow.

Investors were encouraged by some good news on the economy. The Federal Reserve said output by U.S. factories, mines and utilities climbed in September despite the effects of Hurricane Florence, and the Labor Department said U.S. employers posted the most jobs in two decades in August while hiring continued to increase.

The S&P 500 index jumped 54 points, or 2 percent, to 2,805 as of 2:45 p.m. Eastern time. The Dow gained 494 points, or 2 percent, to 25,745.

The Nasdaq composite climbed 192 points, or 2.6 percent, to 7,623 as technology companies reversed some of their outsize losses from the last few days. The Russell 2000 index of smaller-company stocks rose 39 points, or 2.6 percent, to 1,592.

Earnings for U.S. companies climbed about 20 percent in each of the first two quarters of 2018 as economic growth picked up and corporate taxes were slashed. Analysts expect similar results in the current period.

Stocks have gyrated over the last three days following a six-day losing streak that included some of their biggest declines of the year. The S&P 500 fell 6.9 percent from its record high on Sept. 20 to its recent low on Thursday. It remains 4.3 percent below that record level.