TREASURIES-Short, medium-dated note prices dip after Gross departs Pimco

* Pimco CIO Bill Gross joins Janus Capital (NYSE: JNS - news)

* U.S. GDP, consumer sentiment data as expected (Updates prices)

By Sam Forgione

NEW YORK, Sept 26 (Reuters) - Short- and intermediate-dated U.S. Treasuries prices dipped Friday on news that Pimco Chief Investment Officer Bill Gross is joining rival Janus Capital Group, which spurred concerns Pimco may have to sell Treasuries if investor redemptions at the firm increase.

Gross, a Pimco co-founder, managed the $222 billion Pimco Total Return Fund, the world's biggest bond fund. Analysts said traders sold Treasuries on bets that outflows across Pimco could accelerate rapidly, leading Pimco to sell holdings in order to raise cash.

"This news of Gross's departure is gigantic," said Tom di Galoma, head of rates and credit trading at ED&F Man Capital Markets in New York. "People are concerned that Pimco is going to have to liquidate, so there is some pre-selling going on ahead of the fact that they may have to do some selling."

The Pimco Total Return Fund had 41 percent of its holdings in U.S. government-related securities at the end of August, according to data on the Pimco website.

Analysts said prices on short- and medium-dated Treasuries fell since Gross has favored those maturities in recent months on the view that the Federal Reserve would keep interest rates lower for longer.

Separately, the Commerce Department raised its estimate of second-quarter gross domestic product to show the economy expanded at a 4.6 percent annual rate, in line with economists' expectations according to a Reuters poll.

The Thomson Reuters/University of Michigan's final September reading on consumer sentiment finished at 84.6, the highest since July 2013 and just below economists' expectations for 84.7, according to a Reuters poll.

Analysts said the data led traders to redirect some cash out of safe-haven Treasuries and into U.S. stocks after Thursday's broad selloff in U.S. shares and rally in Treasuries prices.

"I think we're definitely seeing money flows coming out of bonds and going back into equities," said Kevin Giddis, head of fixed income at Raymond James in Memphis, Tennessee.

U.S. 10-year Treasury notes were last down 5/32 in price to yield 2.53 percent, from a yield of 2.51 percent late Thursday. The yield hit a session high of 2.55 percent.

U.S. 30-year Treasury bonds were last up 1/32 in price to yield 3.22 percent, unchanged from late Thursday. The yield earlier hit a session high of about 3.26 percent.

Yields on 30-year Treasuries, which move inversely to prices, were set for their biggest weekly dip in six weeks. Yields on 10-year notes were on track for their biggest weekly decline in four weeks.

U.S. five-year Treasury notes were last down 5/32 to yield 1.80 percent, from 1.76 percent late Thursday.

On Wall Street, the benchmark S&P 500 closed up 0.86 percent. (Additional reporting by Karen Brettell; Editing by Bernadette Baum, Dan Grebler and Tom Brown)