Stocks Lock In Gains

Updated from 2:53 p.m. EDT

Following a day marked by choppy but mostly positive trading, U.S. stocks finished Thursday on the upside, as a decline in third-quarter GDP was narrower than expected and companies issued a heap of quarterly earnings statements.

The Dow Jones Industrial Average climbed 189.73 points, or 2.1%, to 9180.69, and the S&P 500 added 24 points, or 2.6%, to 954.09. TheNasdaq jumped 41.31 points, or 2.5%, to 1698.52.

Ahead of Thursday's session, the Department of Commerce reported that GDP contracted 0.3% in the third quarter, providing a strong indication that the U.S. has entered a recession. The decline was narrower than expected by economists but down from growth of 2.8% in the second quarter. Consumer spending for the third quarter was down 3.1%, the biggest drop since 1980.

Separately, the Department of Labor's initial jobless claims for the week ended Oct. 25 registered at 479,000, above analyst estimates and level with the previous week.

"If you'd been wondering if there was recession, this kind of brings it home," said Phil Dow, director of equity strategy at RBC Dain Rauscher. He said that historically, a recession has been ongoing by the time the government says there is one, and that he thinks going forward the U.S. will see a two-quarter recession followed by modest growth.

"We shouldn't look for perfection in these estimates," said Dow. "It's pretty easy to get in a black mood and think that this is going to extend forever."

As for the GDP number's impact on stocks, "Normally you have the stock market recover even when it's cloudy," said Dow, and he said the market feels like it's close to an interesting bottom in pricing.