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US stocks gain after GDP growth revised up

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US stocks have closed higher, helped by an expected strong upward revision in the US economic growth estimate for the third quarter.

The Dow Jones Industrial Average finished up 38.71 points (0.28 per cent) at 13,021.82 on Thursday.

The S&P 500 gained 6.02 (0.43 per cent) at 1,415.95, while the Nasdaq Composite added 20.25 (0.68 per cent) at 3,012.03.

The Commerce Department raised its estimate for third-quarter growth as expected, to 2.7 per cent from 2.0 per cent. However, the details on consumer spending in the period pointed to a slower fourth quarter.

“The prevailing message is that the economy is growing, but at a rate that is below potential and which is making it difficult to put a major dent in the unemployment rate,” said Patrick O’Hare of Briefing.com.

Online discount broker Groupon was up 2.7 per cent after a board meeting produced no fireworks, amid reports of fractures between the company’s founders and management.

There had been speculation that chief executive Andrew Mason’s head was on the block.

“The board and management team are focused on the performance of the company and they are all working together with heads down to achieve Groupon’s objectives,” spokesman Paul Taaffe said.

Poor data from retailers echoed the read on consumer spending in the GDP numbers.

Shares of department store Kohl’s sank 12 per cent after it reported a 5.6 per cent fall in same-store sales in November. Analysts had expected a rise.

Kohl’s competitor Macy’s lost 4.3 per cent on its lower November sales, though it blamed the impact of Hurricane Sandy, which shut down much of the New York area economy in the first week of the month.

Jeweller Tiffany & Co lost 7.5 per cent as it missed quarterly earnings expectations – net earnings fell 30 per cent – and cut its forecast for the rest of the year.

Barnes & Noble plunged 11.2 per cent as it reported disappointing sales of its Nook e-reader in its quarterly earnings, though overall the company beat expectations on the bottom line.

Volatile BlackBerry maker Research In Motion added four per cent, helped by an upgrade from Goldman Sachs. Earlier the share was up more than 10 per cent.

Bond prices were mixed. The 10-year US Treasury yield was flat at 1.62 per cent, while the 30-year moved to 2.8 per cent from 2.78 per cent Wednesday.

Bond prices and yields move inversely.