US STOCKS-Wall Street boosted by stimulus hopes

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* Indexes up: Dow 1.09%, S&P 1.38%, Nasdaq 1.61%
* All 11 major S&P sectors rise
* Germany ready to take on new debt in case of recession
-report
* Nvidia jumps after results, lifts chip stocks
* Bank stocks rise as U.S. Treasury yields ease off lows
* FAANG stocks gain

(Updates to early afternoon)
By Medha Singh and Arjun Panchadar
Aug 16 (Reuters) - Wall Street's three main indexes rose
more than 1% on Friday, clawing back some losses from a brutal
selloff this week on hopes of more stimulus from central banks
to perk up slowing growth.
Stocks got a boost after a report that Germany's government
would be prepared to ditch its balanced budget rule and take on
new debt to counter a possible recession. "Germany is now telling us that we are going to have to move
forward and spend at a deficit in an effort to keep our economy
and the broader economy afloat," said Yousef Abbasi, global
market strategist at INTL FCStone Financial Inc in New York.
Earlier, China's state planner said it would roll out a plan
to boost disposable income this year and in 2020 to spur
consumption as the economy slows. Traders are betting on a one-in-five chance of a 50 basis
point interest rate cut from the Federal Reserve, while
expecting aggressive easing from the European Central Bank at
its policy meetings in September.
However, the three main indexes are still set to record
their third consecutive week of losses as investors worry about
the risk of recession and U.S.-China trade tensions.
At 12:36 p.m. ET, the Dow Jones Industrial Average .DJI
was up 277.57 points, or 1.09%, at 25,856.96, the S&P 500 .SPX
was up 39.18 points, or 1.38%, at 2,886.78. The Nasdaq Composite
.IXIC was up 124.74 points, or 1.61%, at 7,891.35.
All of the 11 major S&P sectors were higher, with technology
stocks .SPLRCT providing the biggest boost.
Sectors seen as bond proxies due to their high dividend
yields - real estate .SPLRCR , utilities .SPLRCU and consumer
staples .SPLRCS - posted smallest gains.
Among stocks, Nvidia Corp NVDA.O jumped 5.9% after posting
better-than-expected quarterly profit and revenue, lifting the
Philadelphia chip index .SOX 2.41%. However, Applied Materials Inc AMAT.O fell 1.7% after the
chip gear maker cautioned that recovery in the memory chip
market is unlikely before 2020. The S&P 500 bank sub-sector .SPXBK rose 2.61% as
rate-sensitive lenders benefited from U.S. Treasury bond yields
easing off their lows. US/
General Electric Co GE.N jumped 9.1% as Chief Executive
Officer Larry Culp bought nearly $2 million worth of company
shares, which had recorded their biggest one-day percentage fall
in 11 years on Thursday.
Advancing issues outnumbered decliners by a 3.68-to-1 ratio
on the NYSE and by a 3.72-to-1 ratio on the Nasdaq.
The S&P index recorded 29 new 52-week highs and seven new
lows, while the Nasdaq recorded 31 new highs and 81 new lows.