* U.S. CPI falls in Sept; weekly jobless claims down
* Citi rises after results
* Indexes up: Dow 1.1 pct, S&P 1.3 pct, Nasdaq 1.5 pct (Updates to late afternoon)
By Caroline Valetkevitch
Oct 15 (Reuters) - U.S. stocks rallied on Thursday after two days of losses, led by a jump in financial shares following upbeat results from Citigroup.
The S&P 500 health care index was also up sharply, despite a disappointing forecast from HCA Holdings, which fell 5 percent at $72.24. The Nasdaq Biotech Index was up 3.8 percent.
Citigroup rose 4.8 percent to $53.15 after the third-biggest U.S. bank's results beat estimates, while Goldman Sachs was up 1.3 percent at $181.86, despite weak results.
The financial sector rose 2.2 percent, recovering from losses Wednesday when JPMorgan results disappointed.
The market's gains follow two days of declines and increased worries about the outlook for U.S. earnings. As the earnings season gathers steam, investors will be scrutinizing results and forecasts for any signs of an impact from a slowing global economy.
Advancing issues outnumbered declining ones on the NYSE by 2,449 to 616, for a 3.98-to-1 ratio on the upside; on the Nasdaq, 2,262 issues rose and 563 fell, for a 4.02-to-1 ratio favoring advancers.
"Everything is having a pretty good move, even the financials," said Frank Gretz, market analyst and technician for brokerage Wellington Shields & Co in New York.
"It just got washed out enough, so I think we're in the midst of a year-end rally, thought obviously it isn't going to go straight up."
At 3:16 p.m., the Dow Jones industrial average rose 190.67 points, or 1.13 percent, to 17,115.42, the S&P 500 gained 26.28 points, or 1.32 percent, to 2,020.52 and the Nasdaq Composite added 73.09 points, or 1.53 percent, to 4,855.94.
Data showed U.S. consumer prices declined the most in eight months as gasoline costs fell in September, but a rise in core CPI, which strips out food and energy costs, suggested inflation was starting to firm.
Unemployment benefit claims, however, fell in the last week, pointing to a strong labor market.
The data, coming on the back of weak retail sales, added to the uncertainty over the timing of an interest rate increase as the Federal Reserve waits for signs of stabilizing global economy. (Additional reporting by Abhiram Nandakumar in Bengaluru; Editing by Saumyadeb Chakrabarty and Nick Zieminski)