NEW YORK — Stocks logged their best day in three months as investors rushed into the market Thursday on word that the economy grew faster than expected during the summer.
The Dow Jones industrial average jumped 200 points to recoup most of its losses for the week, while demand for havens such as Treasurys wilted.
The Commerce Department’s report that gross domestic product rose at an annual rate of 3.5 percent in the third quarter reinvigorated investors who had dumped stocks for much of the week on signs of a slowing housing market and a disappointing report on consumer confidence.
The economic growth came in ahead of the 3.3 percent rise forecast by economists polled by Thomson Reuters. It was the strongest growth in two years and broke four straight quarters of declines. Coming on the 80th anniversary of the stock-market crash that triggered the Great Depression, it was the best indication yet that the longest recession since then has ended.
But many analysts caution that it will be difficult to sustain growth at the pace seen in the third quarter.
Government stimulus programs, including the popular Cash for Clunkers auto rebates and tax credits for first- time homebuyers, bolstered the economy. Once the government’s stimulus measures run their course, the economy could run afoul of lingering problems such as high unemployment and weak consumer spending.
The Dow Jones industrial average rose 199.89, or 2.1 percent, to 9,962.58. It was the best day for the Dow since July 15.
The broader Standard & Poor’s 500 index rose 23.48, or 2.3 percent, to 1,066.11, while the Nasdaq composite index rose 37.94, or 1.8 percent, to 2,097.55.
Bond prices fell, pushing their yields higher. Bonds extended their early losses after a lackluster auction of seven- year notes.
Mitch Schlesinger, a managing partner at FBB Capital Partners in Bethesda, Md., said that because of government support, fourth-quarter GDP should provide a better picture of how much the economy has recovered.
“Some of the artificial goosing of the numbers will come out, and we’ll get a better picture,” Schlesinger said.
He added that the economy is likely to grow in the fourth quarter, but probably not as fast as in the third quarter.
In the interim, however, investors will welcome the better-than-expected third-quarter report, he said.
Other economic news was mixed. The number of people claiming jobless benefits for the first time dropped less than expected last week. The Labor Department said workers filing first-time claims for unemployment dipped 1,000 to a seasonally adjusted 530,000 last week. Economists expected a decline to 521,000.
The number of people receiving unemployment benefits on an ongoing basis dropped by 148,000 to 5.8 million.
Unemployment and consumer spending remain the economy’s biggest hurdles.
