U.S. stocks climbed for a third day on Thursday, rising more than 2 percent to session highs after Standard & Poor's cut General Electric's ratings by just a single notch and signaled no further downgrades loomed, while data suggested some stabilization in consumer spending.

Investor sentiment was also lifted by news of a takeover in the biotechnology sector, bolstering shares of health-care companies.

The Dow Jones industrial average <.DJI> rose 155.15 points, or 2.24 percent, to 7,085.55. The Standard & Poor's 500 Index <.SPX> gained 17.19 points, or 2.38 percent, to 738.55. The Nasdaq Composite Index <.IXIC> climbed 28.91 points, or 2.11 percent, to 1,400.55.

(Reporting by Leah Schnurr; Editing by Jan Paschal)