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U.S. stocks gain on solid data, Bernanke comments; Dow rises 1.26%

Published 02/27/2013, 04:29 PM
Updated 02/27/2013, 04:30 PM
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Investing.com - U.S. stock prices rose on Wednesday, ending the day at near session highs after better-than-expected housing and factory data boosted spirits in U.S. equities markets.

At the close of U.S. trading, the Dow Jones Industrial Average finished up 1.26%, the S&P 500 index ended up 1.27%, while the Nasdaq Composite index rose 1.04%.

In the U.S. earlier, the Commerce Department reported that order for durable goods dropped 5.2% in January compared with market calls for a decline of 4.4%.

However, core durable goods orders, which exclude volatile transportation items, rose 1.9% last month, beating expectations for a 0.2% increase.

Meanwhile, the National Association of Realtors reported that its pending home sales index rose by 4.5% in January, beating expectations for a 1.5% gain.

The numbers sent stock prices gaining as did a second day of congressional testimony by Federal Reserve Chairman Ben Bernanke, who reassured lawmakers that loose monetary policies haven't created asset bubbles or inflationary pressures, which left investors concluding the U.S. central bank will keep monetary stimulus tools in place, a recipe for rising stock prices.
Good news in Europe also fueled the rally.

Italy sold a target EUR6.5 billion in five and 10-year bonds just two days after Italian elections wrapped up with no party in control of the Senate, which spooked investors and raised concerns that political uncertainty could lead to a dismantling of economic reforms and a rekindling of the European debt crisis.

The yield on Italian 10-year bonds rose to 4.83%, the highest since October, from 4.17% at a similar auction last month.

Leading Dow Jones Industrial Average performers included JPMorgan Chase, up 3.51%, Caterpillar, up 2.57%, and Boeing, up 2.30%.

The Dow Jones Industrial Average's worst performers included McDonald's, down 0.53%, Hewlett-Packard, down 0.15%, and Verizon Communications, which was up 0.48%.

European indices, meanwhile, where up.

After the close of European trade, the EURO STOXX 50 rose 161%, France's CAC 40 rose 1.92%, while Germany's DAX 30 finished up 1.04%. Meanwhile, in the U.K. the FTSE 100 finished up 0.88%.

On Thursday, the U.S. is to release revised data on fourth-quarter economic growth in addition to the weekly government report on initial jobless claims and official data on manufacturing activity in Chicago.








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