Major stock indexes were up more than 1 percent in late morning trade with broad gains across sectors. The U.S. economy needs to grow more quickly if it is to produce enough jobs to bring down the unemployment rate further, Bernanke told a gathering of the National Association for Business Economics.
“Further significant improvements in the unemployment rate will likely require a more rapid expansion of production and demand from consumers and businesses, a process that can be supported by continued accommodative policies,” he said.
Jim Russell, chief equity strategist at U.S. Bank Wealth Management in Cincinnati, said Bernanke’s comments reinforced investors’ perception that the Fed’s policy would remain accommodative and possibly include further quantitative easing, or QE3.
“The mandate of the Fed regarding unemployment has not been fulfilled, and Bernanke is looking under every rock to responsibly fulfill that portion of the mandate,” Russell said. “He continues to leave QE3 on the table, which will be used on a as-needed basis.”
The Jones industrial average was up 134.15 points, or 1.03 percent, at 13,214.88. The Standard & Poor’s 500 Index was up 14.18 points, or 1.01 percent, at 1,411.29. The Nasdaq Composite Index was up 35.56 points, or 1.16 percent, at 3,103.48.
The benchmark S&P index fell 0.5 percent last week, a relatively minor decline that was still the biggest weekly slide since the final week of December.
Improving sentiment about the pace of economic growth has kept investors piling into equities. The S&P 500 is near its highest point since May 2008, and the has risen for six straight weeks.
U.S. pending home sales slid 0.5 percent in February, according to the National Association of Realtors, confounding expectations for a rise of 1 percent. Equities were little impacted by the data, though homebuilder D.R. Horton Inc fell 0.6 percent to $15.33.
Lions Gate Entertainment Corp rallied 3.3 percent to $15 after the strong opening to its film “The Hunger Games,” which made $214 million over the weekend globally.
Cal-Maine Foods Inc reported third-quarter that fell from the prior year on rising feed costs, which the company sees persisting through the summer. Shares fell 4 percent to $40.27. BATS Global Markets Inc on Sunday apologized for a system failure that caused shares in its own initial public offering to erroneously trade for less than a penny on Friday and resulted in Apple Inc’s shares being temporarily halted. BATS Chief Executive Joe Ratterman called the incident a “devastating moment,” and said the company’s withdrawn IPO was on hold “for the foreseeable future.
