* Initial jobless claims fall more than expected
* All 10 S&P 500 sectors higher, financials leading gains
* Pioneer Natural Resources jumps after results
* Indexes up: Dow 0.8 pct, S&P 1.1 pct, Nasdaq 1.1 pct
By Alison Griswold
NEW YORK, Aug 1 (Reuters) - The S&P 500 surpassed 1,700 on
Thursday and U.S. stocks rose after economic data pointed to a
modestly improving economy and the Federal Reserve kept its
massive monetary stimulus in place.
In its latest policy statement on Wednesday, the Federal
Reserve gave no hint that a reduction in the pace of its
bond-buying program was imminent, as the economy continues to
recover but is still in need of support.
Global central banks on Thursday also remained accommodative
with European Central Bank President Mario Draghi reiterating
the ECB's rates will remain at their present level or lower for
an "extended period" of time.
Data on weekly U.S. initial jobless claims and national
manufacturing came in better than expected, while construction
spending dropped 0.6 percent in June, below forecasts calling
for a 0.4 percent rise.
"This morning we got some tremendous data in the U.S.," said
John Brady, managing director at R.J. O'Brien & Associates in
Chicago. "The ISM manufacturing number was very strong, and
that's led to a further move upward in equity prices."
Stocks advanced broadly, with all of the 10 S&P 500 industry
sectors moving higher. Growth-sensitive financials, industrials
and consumer discretionary shares registered the biggest gains.
JPMorgan Chase, Bank of America and Wells
Fargo were among the companies giving the greatest boost
to the S&P 500. Shares of JPMorgan gained 1.7 percent to $56.70,
Bank of America rose 2.2 percent to $14.92 and Wells Fargo added
1.6 percent to $44.21.
The S&P 500 financial index was up 1.6 percent.
The Dow Jones Industrial Average rose 123.22 points,
or 0.79 percent, to 15,622.76. The Standard & Poor's 500 Index
climbed 18.03 points, or 1.07 percent, to 1,703.76, and
the Nasdaq Composite Index added 38.50 points, or 1.06
percent, to 3,664.87.
Earlier in the session, the benchmark S&P rose to a new
intraday high of 1,704.97.
Yelp Inc surged 22.8 percent to $51.31 after the
consumer reviews website posted a smaller-than-expected
quarterly loss and forecast third-quarter revenue above
Pioneer Natural Resources was the S&P 500's biggest
percentage gainer after reporting its second-quarter results.
The company's shares jumped 13.3 percent to $175.35, after
hitting an all-time high of $180.99 earlier in the session.
On the downside, Exxon Mobil Corp dipped 1.8 percent
to $92.04, the biggest drag on the Dow and the S&P 500, after
reporting a sharp drop in quarterly profit on lower oil and gas
output production and weaker earnings from its refining
Of the 375 companies in the S&P 500 that have reported
earnings for the second quarter, 67.5 percent have topped
analyst expectations, in line with the average beat over the
past four quarters, data from Thomson Reuters showed. About 55
percent have reported revenue above estimates, above the average
beat of the past four quarters but below the historical average.
Weekly initial jobless claims data showed a drop of 19,000
to a seasonally-adjusted 326,000, the lowest since January 2008
and better than the 345,000 forecast.
The drop in initial claims, coupled with Wednesday's
better-than-expected ADP employment report, bodes well for
payrolls data on Friday.
The Institute for Supply Management said its index of
national factory activity rose to 55.4 in July, its highest
level since June 2011.
Financial data firm Markit said its final U.S. Manufacturing
Purchasing Managers Index for July rose to 53.7, the highest