US stocks gained in choppy trading on Thursday after Senate Majority Leader Harry Reid said that Democrats were all on the same page on budget talks.

When the market closed, the Dow Jones Industrial Average gained 36.71 points, or 0.28 percent, to 13,021.82. The Standard & Poor's 500 was up 6.02 points, or 0.43 percent, to 1,415.95. The Nasdaq Composite Index jumped 20.25 points, or 0.68 percent, to 3,012.03.

Thursday's trading was dominated by news out of Washington. Stocks started on strong notes after data showed the US economy grew at a 2.7 percent annual rate in the third quarter, much faster than the previous estimate of 2.0 percent.

Meanwhile, a report from the Labor Department added to the upbeat tone. The report showed US initial jobless claims declined 23,000 in the week ended Nov. 24 to 393,000, as effect of Hurricane Sandy faded.

Pending home sales climbed 5.2 percent in October, surging to its highest level in more than five years, according to the National Association of Realtors.

Major indexes pared earlier gains and turned mixed in midday trading after House of Representatives Speaker John Boehner said " no substantive progress" was made in talks with the White House on the "fiscal cliff."

However, Senate Majority Leader Harry Reid said on the same day that Democrats were all on the same page on budget talks and Senator Chuck Schumer said there has been progress.

President Barack Obama on Wednesday said at the White House that he hoped that the two parities could reach agreement before Christmas. Optimistic remarks by Obama and several Republican leaders on the fiscal cliff reversed the downward trend of US stocks Wednesday and continued supporting the market on Thursday.

In other market, the US dollar fell on Thursday as investors turned to riskier currencies amid optimism to avoid fiscal cliff. In late New York trading, the euro gained to 1.2972 dollars from 1. 2932 of the previous session.

Crude prices rose on Thursday as continuing unrest in the Middle East caused supplies fears. Light, sweet crude for January delivery rose 1.58 dollars, or 1.83 percent, to settle at 88.07 dollars a barrel on the New York Mercantile Exchange. Brent crude for January delivery gained 1.25 dollars, or 1.14 percent to finish at 110.76 dollars a barrel.