US STOCKS-Wall St rises on economic hopes ahead of payrolls

                                

  * Pending home sales unexpectedly rise, jobless claims dip
  * Retail index rises after Aug same-store sales data
  * Chipmakers, recently battered, continue to rise
  * Dow up 0.5 pct; S&P up 0.9 pct, Nasdaq up 1.1 pct
 * For up-to-the-minute market news see [STXNEWS/US]
  (Updates to close, changes byline)
                                
 By Rodrigo Campos
                                
 NEW YORK, Sept 2 (Reuters) - U.S. stocks rose on low
volume on Thursday as data showed improvement in housing and
the job market a day ahead of the critical monthly payrolls
figures.
                                
 Investors built on Wednesday's sharp advance as indicators
provided the latest reason for optimism the economy could
avoid another downturn. But the nascent rally could be
derailed if Friday's jobs data disappoints investors.
                                
 "Money seems to be flowing out of bonds and into the stock
market," said Ryan Detrick, senior technical strategist at
Schaeffer's Investment Research in Cincinnati.
                                
 "Obviously, tomorrow comes the big news with the
employment data. But in the near term, it shows how explosive
rallies can be when we get decent economic data, because the
market is pricing a double-dip recession."
                                
 Chipmaker shares rose for a second day running and the
PHLX semiconductor index <.SOX> gained 2.1 percent to close
above its 14-day moving average for the first time since late
July.
                                
 Broadcom Corp <BRCM.O>, up $1.63 at $32.71, posted a 9.2
percent advance in the last two sessions, its largest such
gain since May 2009.
                                
 The Dow Jones industrial average <.DJI> added 50.63
points, or 0.49 percent, to 10,320.10. The Standard & Poor's
500 Index <.SPX> rose 9.81 points, or 0.91 percent, to
1,090.10. The Nasdaq Composite Index <.IXIC> gained 23.17
points, or 1.06 percent, to close at 2,200.01.
                                
 About 6.6 billion shares traded on the New York Stock
Exchange, the Nasdaq and the American Stock Exchange, about
average for the past month, but still way below last year's
daily average of 9.65 billion. Volume is typically light in
the days just ahead of the Labor Day holiday weekend.
                                
 The housing and labor markets have long been considered
two of the biggest headwinds the economic recovery faces.
Friday's payrolls report is expected to show about 100,000
jobs were lost in August.
                                
 Data from the National Association of Realtors showed
pending home resales rose unexpectedly in July and a separate
report showed new claims for unemployment insurance fell for a
second straight week. [ID:nN02194957].
                                
 Shares of Hovnanian Enterprises <HOV.N> rose 5.4 percent
to $3.88 on the home sales data and after the sixth-largest
U.S. builder reported a narrower quarterly loss late on
Wednesday. [ID:nN02202669].
                                
 "Homebuilders, semis are doing well, the riskier trade is
kind of back on," said Detrick.
                                
 The biggest open interest on an ETF that tracks the S&P
500 was at September $109 on the call side and September $110
on the put side. Since the SPDR S&P 500 <SPY.P> was at 109.47,
the open interest suggests options investors are not expecting
a major move after the payrolls report.
                                
 The S&P 500's moving average convergence-divergence or
MACD generated a 'buy' signal after having been a 'sell' since
Aug. 11. The last time the signal turned bullish was July 9,
foreshadowing an advance that ended a month later and made
July the best month for the index in a year.
                                
 "At least in the near term, that's a sign things are
improving. That's usually the first step. We need that
positive MACD for bigger future gains," Schaeffer's Detrick
said.
                                
 The Morgan Stanley Retail index <.MVR> rose 2.4 percent
and Nordstrom Inc <JWN.N> jumped 8.1 percent to $32.76 as U.S.
retailers posted better-than-expected sales in August.
[ID:nN02146293].
                                
 "Today's data is positive, but given the high level of
unemployment, it's hard to be too optimistic about the
consumer," said Michael Sheldon, chief market strategist at
RDM Financial in Westport, Connecticut.
                                
 Burger King Holdings Inc <BKC.N> agreed to sell itself to
investment firm 3G Capital for about $3.26 billion, pushing
the stock up 25.1 percent to $23.59. [ID:nN02193380].
                                
 In the end to an extended bidding war, Hewlett-Packard Co
<HPQ.N> raised its buyout offer for data storage company 3PAR
Inc <PAR.N> to $33 a share, topping an earlier bid from Dell
Inc <DELL.O>. The higher bid prompted Dell to bow out.
[ID:nN02121852].
                                
 Shares of 3PAR rose 2.5 percent to $32.88 while Dell
gained 2 percent to $12.36.
                                
 HP, a Dow component, rose 1.2 percent to $39.68.
                                
 Advancing stocks outnumbered declining ones on the NYSE by
a ratio of about 7 to 3, while on the Nasdaq, about eight
stocks rose for every five that fell.
 (Reporting by Rodrigo Campos; Additional reporting by Ryan
Vlastelica and Angela Moon; Editing by Jan Paschal)