Stocks rallied late Thursday as investors responded with optimism to a positive durable goods report and upbeat earnings estimates.

The Dow Jones industrial average soared 117.56, or 0.2 percent, to end at 9,829.42. The Dow is 19.3 percent above its low of 8,235.81, where it closed Sept. 21 following the terror attacks. The Nasdaq Composite Index rose 45.29, or 2.4 percent, to end at 1,933.26, while the broad Standard & Poor's 500 index was up 11.68, or 1.0 percent, to 1,140.20.

Investors are waiting for Friday's second official reading of third-quarter Gross Domestic Product (GDP), the broadest measure of the nation's economic health. GDP is expected to contract 0.9 percent, according to a Reuters poll of economists, versus a contraction of just 0.4 percent shown by an earlier reading released in late October.

Wall Street reacted positively to new data showing orders to U.S. factories for costly manufactured goods soared a record 12.8 percent in October, reflecting stronger demand for a wide variety of big-ticket items, from cars to computers.

Companies that make consumer durables - products expected to last at least three years - likewise were winners on Wall Street Thursday. Dell Computer climbed $1.07 to $27.06, and General Motors rose 99 cents to $48.59.

Investors were also encouraged by a government report showing sales of new, single-family homes rose 0.2 percent to an annual rate of 880,000 units last month from 878,000 in September.

"People are becoming more comfortable that the economic downturn is behind us. The stock market is forward looking, and ... the notion is that we have a bottom in place, that we have made our lows," said Brian Belski, fundamental market strategist for US Bancorp Piper Jaffray.

The bad news came in the weekly jobless numbers, which were up 54,000. The number of workers filing initial jobless claims for the week ended Nov. 24, hit 488,000, the Labor Department reported. That was well above the 448,000 claims economists in a Reuters poll were expecting for the week -- one which would typically see light filings because of the Thanksgiving holiday.

Enron's demise also contributed to some investor anxiety throughout the day.

Enron Corp., teetering on the brink of one of the biggest corporate implosions in U.S. history, plunged 85 percent in frenzied trading Wednesday and fell another 41 percent, or 25 cents, to 36 cents on Thursday.

Enron sank after rival Dynegy Inc. pulled out of its planned $9 billion takeover of the beleaguered energy trader. Credit rating agencies slashed Enron's bonds to junk status and shoved the once mighty company another step closer to bankruptcy. Dynegy fell $2.24 cents to $33.65.

Enron squeezed other energy traders and financial giants Citigroup Inc. and JP Morgan Chase & Co. Inc., which may suffer losses of more than $400 million combined on their lending to the energy trading group, according to at least one analyst.

In trading, financial giant Citigroup Inc. rose 56 cents to $48.36 and J.P. Morgan Chase & Co. Inc. was up 56 cents at $38.06. The two Dow components, which lent money to Enron, saw their stocks rebound slightly after falling sharply on Wednesday.

Technology shares were big winners in Thursday's rally.

Business-to-business software maker FreeMarkets Inc. jumped nearly 34 percent after the company raised its forecast for fourth-quarter revenues and profits. FreeMarkets gained $4.59 at $18.18, up 34 percent on Nasdaq, where it was one of the day's biggest gainers.

Brocade, a data storage networker, rallied $2.88, or 10 percent, to $31.70 after posting results that edged past expectations and forecast a steady or stronger showing in the current quarter.

Health care giant Johnson & Johnson dropped $1.51 to $58.48, dragging on the Dow. Morgan Stanley downgraded its rating on the stock, citing litigation from a withdrawn ulcer drug and a fairly weak pipeline of experimental drugs.

Advancing issues outnumbered decliners more than 3 to 2 on the New York Stock Exchange. Consolidated volume came to 1.74 billion shares, compared with Wednesday's 1.90 billion.

The Russell 2000 index, the barometer of smaller company stocks, rose 9.63, or 2.1 percent, to 463.33.

Overseas, markets were modestly higher Thursday with Japan's Nikkei stock finishing up 0.3 percent. Britain's FT-SE 100 inched up 0.1 percent, and Germany's DAX index rose 0.4 percent, while France's CAC-40 ended unchanged.

Reuters and the Associated Press contributed to this report.