Oct. 31 (Bloomberg) -- U.S. stocks rose after the economy contracted less than forecast in the third quarter and investors speculated global interest-rate cuts will stem a further slump.

The economy suffered its biggest decline since 2001 in the third quarter, ushering in what may be the worst recession in a quarter-century and boosting the chances of Barack Obama and fellow Democrats in next week's elections.

TOP STORIES/MOST READ ON BLOOMBERG

U.S. Economy: GDP Shrinks at Fastest Pace Since 2001

The economy suffered its biggest decline since 2001 in the third quarter, ushering in what may be the worst recession in a quarter-century and boosting the chances of Barack Obama and fellow Democrats in next week's elections.

American Express Will Slash 7,000 Jobs, Take Charge

American Express Co., the largest U.S. credit-card company by purchases, will slash 10 percent of its workforce to cut costs amid rising defaults as consumers squeezed by higher unemployment fail to repay their debts.

Fed Buys $145.7 Billion of Commercial Paper in Start of Program

The Federal Reserve bought commercial paper valued at $145.7 billion in the first days of the program aimed at backstopping the market, indicating the central bank is generating most of this week's record gains in short-term corporate borrowing.

Argentine Pension Fund Investments in U.S. Are Frozen

A New York federal judge blocked Argentina from transferring out of the U.S. investments held by its pension funds, granting a request by bondholders holding a $553 million judgment against the South American country.

MAIN ECONOMIC RELEASES TODAY Bank of Japan May Cut Benchmark Interest Rate to 0.25% From 0.5% Japan's September Jobless Rate Seen Unchanged at 4.2% Vs Mth Ago Japan's Consumer Prices Seen Rising 2.3% in September Vs Yr Ago Japan September Household Spending Seen Dropping 4% From Yr Ago Japan's September Housing Starts Seen Rising 52% From Year Ago Australia's September Bank Lending Growth Seen Slowing to 0.4% Reserve Bank of Australia's Debelle Gives Speech in Melbourne Singapore's Third-Quarter Unemployment Rate Seen Rising to 2.6% South Korean Sept. Industrial Production Seen Rising 4.7% on Yr South Korea's November Manufacturers Confidence Index Is Due Thailand September Current Account Deficit Seen at $185 Million Sri Lanka Consumer Prices Report for October Is Due For Release

MAIN ANALYST UPGRADES/DOWNGRADES

ASIAN MARKETS

The Nikkei 225 futures contract due in December dropped 15 points to 9,025. The Hang Seng November contract rose 1,517 to 14,150. The S&P/ASX 200 Index futures due in December fell 4 to 4,014.

U.S. Stocks Gain on GDP, Rate Cuts; Intel, Home Depot Advance

U.S. stocks rose after the economy contracted less than forecast in the third quarter and investors speculated global interest-rate cuts will stem a further slump.

U.S. Treasuries Fall on Debt-Supply Outlook as Economy Shrinks

Treasuries dropped, pushing 10-year yields to the highest in two weeks, amid concern U.S. efforts to unfreeze credit markets and prop up the financial system will swell sales of government debt.

Yen Falls as Rate Cuts, Stock Gains Boost Higher-Yield Demand

The yen dropped for a third day versus the euro and fell against the dollar as global interest-rate cuts sparked gains in stock markets, boosting demand for higher-yielding assets funded by low-cost loans in Japan.

European Stocks Climb on Rate Cuts, Earnings; BHP, Alcatel Jump

European stocks rallied for a third day as central banks from Washington to Hong Kong cut interest rates and the Federal Reserve provided $120 billion to South Korea, Singapore, Brazil and Mexico to unlock lending in emerging markets.

European Bond Yield Difference Widens to Most in 3 1/2 Years

The yield difference between two-and 10-year European government notes widened to the most in 3 1/2 years as traders increased bets the European Central Bank will lower borrowing costs to avert a recession in the euro-region economy.

Oil Falls on Concern the Economic Contraction May Reduce Demand

Crude oil fell on concern that the biggest decline in the U.S. economy since 2001 will further curb fuel demand in the world's biggest energy consuming country.

Gold Prices Fall as Dollar Rebounds Against Euro; Silver Drops

Gold fell the most in a week as the dollar climbed against the euro on signs that reductions in borrowing costs in Europe will lag behind the U.S. Silver slid.

HIGHLIGHTS FROM NEWSPAPERS

Russia to Begin Building Pipe to China in 2009, Interfax Says

OAO Transneft will begin building an oil pipeline spur to China from the currently under-construction East Siberian Pacific Ocean Pipeline in the first quarter of 2009, Interfax said.

DWS Head Kaldemorgen Sees `Hard Times,' FT Deutschland Reports

Klaus Kaldemorgen, head of Deutsche Bank AG's DWS mutual fund unit in Frankfurt, expects ``hard times'' for mutual funds as investors remain wary of putting money into stocks, Financial Times Deutschland reported.

Last Updated: October 30, 2008 17:14 EDT