NEW YORK (AP) -- Technology companies are leading a stock market rally Friday as investors applaud third-quarter reports from big names including Microsoft and Alphabet, Google's parent company. Amazon is surging on the back of its own strong quarter, while traditional retailers are seeing their stock prices plunge. Wall Street is also pleased that the U.S. economy grew more than expected in the third quarter.
KEEPING SCORE: The Standard & Poor's 500 index rose 19 points, or 0.7 percent, to 2,579 as of noon Eastern time. That put the index on track for another record high. The Dow Jones industrial average climbed 31 points, or 0.1 percent, to 23,432. The Nasdaq composite soared 126 points, or 1.9 percent, to 6,684. The index, which has a large concentration of technology stocks, is on track for more records and is making its largest gain this year. The Russell 2000 index of smaller-company stocks picked up 6 points, or 0.4 percent, to 1,503.
In its first estimate, the Commerce Department said the U.S. economy grew 3 percent between July and September. That was better than expected even though the country was hit by two major hurricanes during those three months. Experts predict the recovery effort after those storms will likely boost the economy in the fourth quarter.
TECH SURGE: Some of the biggest technology companies posted their quarterly results and investors liked what they saw. Alphabet had a stronger quarter than Wall Street expected and its stock jumped $57.74, or 5.8 percent, to $1,049.16, putting it on track for its best day in two years. Microsoft's fiscal first-quarter revenue topped analyst estimates by $1 billion and the stock soared $5.37, or 6.8 percent, to $84.13, also its largest gain in two years. Intel, the world's biggest chipmaker, made its biggest move in three years. It jumped $2.67, or 6.5 percent, to $44.02 after a positive forecast for the fourth quarter of the year.
Apple jumped on reports of strong early orders for the iPhone X, as investors have been concerned demand for the $999 phone might fall short of their hopes. It gained $4.64, or 2.9 percent, to $162.04.
Networking hardware company Gigamon climbed $2.20, or 6.1 percent, to $38.35 after Elliott Management agreed to buy the company for $38.50 a share, or $1.44 billion.
AMAZONIAN STRENGTH: Amazon posted a big sales boost from its "Prime Day" promotion and its recent purchase of the Whole Foods grocery chain. It also gave a strong estimate for the holiday season. Its stock jumped $11.57, or 12.3 percent, to $1,092, its largest gain in two-and- a-half years.
Companies that compete with Amazon struggled: retailers fell after J.C. Penney cut its profit forecast as it lowers prices to try clearing out unsold goods. The department store also reduced its estimate for a key sales measurement. Its stock lost 40 cents, or 10.9 percent, to $3.26. Rival Macy's sank $1.27, or 6 percent, to $20.07.
Toy maker Mattel plunged after the company posted a huge third-quarter loss and said it will slash spending, partly because the bankruptcy of the Toys R Us chain is hurting its business. Mattel plans to cut $650 million in costs and said it will stop paying quarterly dividends. The stock lost $2.28, or 14.8 percent, to $13.10.
HEALTH HAVOC: Drugstores and medication distributors continued to slump following reports Thursday that Amazon is receiving state licenses to let it do business as a prescription drug wholesaler. Walgreens fell $2.62, or 3.9 percent, to $64.49. Prescription drug distributor McKesson fell $7.10, or 4.9 percent, to $136.44 and Cardinal Health lost $1.89, or 2.9 percent, to $62.86. Those losses came after steep declines on Thursday.
CVS Health shed $3.29, or 4.5 percent, to $70.02. In addition to the report on Amazon by the St. Louis Post-Dispatch, investors considered the possibility CVS will buy health insurer Aetna. The Wall Street Journal reported on the deal talks Thursday, but the companies declined to comment. Aetna dipped 46 cents to $178.14 after it surged 11.5 percent a day ago.
ENERGY: Benchmark U.S. crude reached a six-month high as it jumped $1.07, or 2 percent, to $53.71 a barrel in New York. Brent crude, used to price international oils, rose 91 cents, or 1.5 percent, to $59.95 a barrel in London.
BONDS: Bond prices jumped. The yield on the 10-year Treasury note fell to 2.42 percent from 2.46 percent, a seven-month high.
CURRENCIES: The dollar fell to 113.81 yen from 114 yen. The euro slid to $1.1578 from $1.1657.
OVERSEAS: Germany's DAX climbed 0.6 percent and the CAC 40 of France gained 0.8 percent. In Britain, the FTSE 100 rose 0.3 percent. The Spanish Ibex sank 1.5 percent after Catalonia's regional parliament voted to secede from Spain, adding new tensions to the disagreement between the region and the central government in Madrid. Catalonia, which includes Barcelona, accounts for a fifth of the Spanish economy and Spain is deeply set against allowing it to become independent.
The Nikkei 225 of Japan jumped 1.2 percent and South Korea's Kospi advanced 0.6 percent. Hong Kong's Hang Seng index surged 0.8 percent.