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* Claims data points to recovery in U.S. job market
* Verizon rises on Reuters report of possible wireless bid
* 3M Co shares fall after earnings, outlook
* Dow up 0.5 pct, S&P 500 up 0.7 pct, Nasdaq up 0.9 pct
By Caroline Valetkevitch
NEW YORK, April 25 (Reuters) - U.S. stocks rose on Thursday, buoyed by gains in shares of materials companies, including iron ore producer Cliffs Natural Resources Inc, and a drop in weekly jobless claims.
Cliffs' stock jumped 18.6 percent to $21.61 after it posted earnings late on Wednesday that were much better than analysts had estimated. The S&P 500 materials index was up 1.7 percent, leading the S&P 500 higher.
Telecommunications companies' shares also rose following a rally in Verizon Communications Inc. The stock rose 2.5 percent to $53.09 after sources told Reuters it has hired advisers to prepare a possible $100 billion cash-and-stock bid to take full control of Verizon Wireless from joint venture partner, Vodafone Group Plc.
Investors have closely watched earnings to see if they would be enough to extend the market's advance that began at the start of the year, especially since recent economic data has suggested slowing growth in March and early April. Worries about global weakness have also hung over the market.
The majority of S&P 500 companies - 67.7 percent so far - are beating earnings expectations, while just 41.4 percent are surpassing revenue estimates. Though that fits with the usual pattern for earnings season, earnings surprises still tend to lift stocks.
"Companies have gotten very good at controlling expectations. This has been a pattern of crunching down of estimates prior to earnings being released, and when earnings come out, they beat the number," said Stephen Massocca, managing director at Wedbush Equity Management LLC in San Francisco.
"Every earnings season, the bar is somewhere where they can get over it."
The Dow Jones industrial average was up 71.92 points, or 0.49 percent, at 14,748.22. The Standard & Poor's 500 Index was up 11.38 points, or 0.72 percent, at 1,590.17. The Nasdaq Composite Index was up 27.72 points, or 0.85 percent, at 3,297.37.
Thursday's U.S. data gave a less worrisome view of the economy. Initial claims for state unemployment benefits in the latest week dropped a surprising 16,000 to a seasonally adjusted 339,000 compared with expectations for 351,000.
The biggest percentage gainer in both the S&P 500 and the Nasdaq was Akamai Technologies Inc, whose shares surged 19.4 percent to $43.09 after the Internet content delivery company posted first-quarter earnings above Wall Street's estimates late on Wednesday and also forecast second-quarter results above analysts' expectations.
United Parcel Service Inc, considered an economic bellwether, advanced 2.4 percent to $85.51 after the world's largest package-delivery company reported a quarterly profit above analysts' estimates.
But Exxon Mobil Corp and 3M Co bucked the trend as their shares fell.
Exxon slid 1 percent to $88.54. Exxon, which is the largest U.S. company by market capitalization, said its quarterly profit edged up, helped by its chemicals business, but oil and gas production fell.
Fellow Dow component 3M Co lost 2.7 percent to $104.94 after the diversified U.S. manufacturer posted first-quarter earnings and revenue that missed Wall Street's expectations and cut its 2013 profit forecast.