* Caterpillar, 3M surge after topping profit estimates
* Industrials index hits record
* Biogen slumps after results
* Indexes up: Dow 0.7 pct, S&P 500 0.2 pct, Nasdaq 0.2 pct (Adds background in paragraph 8.)
By Caroline Valetkevitch
NEW YORK, Oct 24 (Reuters) - The Dow rallied on Tuesday, registering its biggest daily percentage gain in more than a month, as stronger-than-expected results and forecasts from companies including 3M and Caterpillar fueled optimism about economic strength.
The S&P 500 and Nasdaq ended up slightly.
3M advanced 5.9 percent and Caterpillar rose 5 percent, giving the Dow its biggest boost, after the companies reported quarterly results and gave upbeat outlooks.
The S&P industrial sector, up 0.5 percent, also hit a record intraday high.
“It has been encouraging to see some of these industrial names report solid numbers and raise their guidance,” said Lindsey Bell, investment strategist at CFRA Research in New York.
“Looking at some the earnings we got yesterday and the ones today, you’re seeing strength domestically here in the U.S.”
Stocks trimmed gains late in the day after Bloomberg reported Stanford University economist John Taylor may have won in a show of hands by Senate Republicans when asked by President Donald Trump about their support of potential nominees for Federal Reserve chair.
Many market participants think Taylor, one of several names circulating for the Fed nomination, would be more hawkish than current Fed Chair Janet Yellen and other potential nominees.
Markets reacted to that headline, said Michael O‘Rourke, chief market strategist at JonesTrading in Greenwich, Connecticut, but he said the poll “obviously doesn’t mean anything.”
Also dampening the market’s mood late in the session, Republican Sen. Jeff Flake criticized Trump’s style of governing and announced he would not run for re-election next year, highlighting tensions between the president and fellow Republicans.
The Dow Jones Industrial Average rose 167.8 points, or 0.72 percent, to end at 23,441.76, a record-high close.
The S&P 500 gained 4.15 points, or 0.16 percent, to 2,569.13 and the Nasdaq Composite added 11.60 points, or 0.18 percent, to 6,598.43.
Upbeat results also came from General Motors, which rose 3 percent. The No.1 U.S. automaker reported stronger-than-expected earnings, reaffirmed its full-year earnings forecast and promised to slash stocks of unsold vehicles.
McDonald’s also rose following results. The stock was last up 0.3 percent.
But the financial index, up 0.7 percent, gave the S&P 500 its biggest boost.
Strong earnings and optimism about Trump’s tax plans have boosted stocks in recent sessions.
Offsetting some of the day’s gains, Biogen slipped 3.9 percent after disappointing U.S. sales of a potential blockbuster drug, Spinraza.
Whirlpool tumbled 10.5 percent after the home appliances maker reported profit and sales below estimates and lowered full-year earnings guidance.
Advancing issues outnumbered declining ones on the NYSE by a 1.16-to-1 ratio; on Nasdaq, a 1.03-to-1 ratio favored advancers.
About 6.2 billion shares changed hands on U.S. exchanges. That compares with the 5.9 billion daily average for the past 20 trading days, according to Thomson Reuters data. (Additional reporting by Sruthi Shankar in Bengaluru; editing by Nick Zieminski and James Dalgleish)