US STOCKS-Shares rebound with confidence boost from GE

* GE says will keep dividend, shares jump 13 percent

* Financials, energy recover after Monday's rout

* Dow up 3 pct, S&P and Nasdaq up nearly 4 pct

* For up-to-the-minute market news, please click on [STXNEWS/US] (Updates to add volume, context in indexes)

By Chuck Mikolajczak

NEW YORK, Dec 2 (Reuters) - U.S. stocks snapped back on Tuesday after a pledge by General Electric (GE.N), a global bellwether, to leave its dividend intact in a fragile economy sparked optimism.

Financial stocks recovered a sizable chunk of Monday's record loss after the Federal Reserve extended several emergency measures integral to stabilizing banks during the credit crisis.

The move by the U.S. central bank came a day after Fed Chairman Ben Bernanke emphasized that policy-makers were determined to stabilize the economy and financial markets.

The S&P financial index .GSPF rose nearly 8 percent, as Citigroup (C.N) and Bank of America (BAC.N) both jumped nearly 12 percent.

But the spotlight was on conglomerate GE, whose shares surged 13.6 percent to $17.61 after the maker of goods from jet engines to lightbulbs said it plans to scale back its sizable finance arm and cut jobs as the U.S. recession digs deeper, while maintaining its dividend. For details, see [ID:nN01506020]

"There's been concern about GE's defending its triple-A credit rating at its financing unit. ... The company is taking steps to bolster that unit, which will help protect its dividend," said Brian Gendreau, an investment strategist in New York for ING Investment Management Americas. "This is helping to pull the market higher."

The Dow Jones industrial average .DJI gained 270.00 points, or 3.31 percent, at 8,419.09. The Standard & Poor's 500 Index .SPX rose 32.60 points, or 3.99 percent, at 848.81. The Nasdaq Composite Index .IXIC added 51.73 points, or 3.70 percent, at 1,449.80.

Energy stocks, currently the cheapest S&P sector in relation to earnings, also drove the Dow higher after losses on Monday. Chevron (CVX.N) gained almost 5 percent to $75.54 while Exxon Mobil (XOM.N) climbed over 4 percent to $77.61.

Stocks pared gains and the Dow briefly turned negative after General Motors (GM.N) reported U.S. vehicle sales declined by 41 percent in November. [nN02291389]

The carmaker recovered to end up almost 6 percent at $4.85, while Ford Motor Co (F.N) rose 6 percent to $2.70.

Executives of the big three U.S. automakers, including Chrysler, are due to present Washington with their plans to justify a $25 billion bailout as worries about possible bankruptcy persist.