Stocks soar despite mixed signs of crisis recovery

By John O'Callaghan

WASHINGTON (Reuters) - Hope grew on Thursday that China's slowest quarter on record may mark a bottom to the global economic crisis as optimism over banking and technology helped stocks defy weak U.S. and European data with a strong rally.

But General Growth Properties GGP.N, the second-largest U.S. mall owner, underscored the tenacious grip of the downturn and trouble caused by frozen lending by filing for bankruptcy protection in the biggest real estate failure in U.S. history.

General Growth said its core business was solid but that bankruptcy was the only way it could refinance debt.

JPMorgan Chase (JPM.N), the No. 2 U.S. bank, started the trading day by bolstering hopes of stabilization in the financial sector with quarterly results that beat forecasts.

Google (GOOG.O), the top U.S. Internet search company, added to a brighter outlook for the tech sector by announcing stronger-than-expected profits after the closing bell.

Improved investor sentiment about the U.S. banking and tech sectors helped to drive the Dow Jones industrial average .DJI up 1.19 percent, the S&P 500 .SPX by 1.55 percent and the tech-heavy Nasdaq .IXIC by 2.68 percent. <MKTS/GLOB>

"We are getting a much better view in terms of what's happening at the corporate level," said Barclays Stockbrokers strategist Henk Potts. "While it's not positive, it's certainly not as gloomy as many market participants had feared."

MIXED SIGNALS