Stocks Rise, Still Bolstered by Bernanke’s Remarks

Stocks continued to rise Thursday on the Federal Reserve’s promise to extend its stimulus policies if necessary as well as upbeat American economic and corporate earnings reports.

In afternoon trading, the Standard Poor’s 500-stock index rose 0.6 percent, the Dow Jones industrial average gained 0.7 percent and the Nasdaq composite was 0.2 percent higher.

Also supporting markets was news that jobless claims in the United States fell 24,000 last week, to 334,000, a sign of steady job gains.

In prepared remarks to lawmakers in Congress, the Fed chairman, Ben S. Bernanke, said the Fed’s timetable for reducing its bond purchases was not decided, adding that the central bank could even increase them if the economy failed to meet expectations.

The Fed wants to see substantial progress in the job market before scaling back its monthly purchases of $85 billion of government bonds and other financial assets, he said.

Expectations that the Fed might start tapering off its stimulus in September caused market jitters last month. But recent disappointing economic data has cast doubt over the likelihood of any big changes in the near future.

In Europe, the FTSE 100 index of British shares rose 1 percent to close at 6,634.36 while the CAC 40 in France gained 1.4 percent to 3,927.79. Germany’s DAX rose 1 percent to 8,337.09

Corporate earnings were mixed. Morgan Stanley shares rose 4.5 percent, boosting financial stocks, after its second-quarter profits beat expectations. I.B.M. also impressed, but Nokia shares slid 3 percent as its sales continued to drop sharply.

Google and Microsoft are due to announce results later.

In Asia, Japan’s Nikkei 225 rose 1.3 percent, to 14,808.50 points, its highest close in two months, but gains elsewhere in the region were much more modest. Australia’s SP/ASX 200 added 0.2 percent, to 4,993.40. Shares in Indonesia, Malaysia, Thailand, India and Singapore were also higher.

Gloom over news earlier in the week that the Chinese economy, the world’s second-largest after the United States, posted its second consecutive quarter of slower growth, weighed on shares tied to China.

Hong Kong’s Hang Seng shed early gains to close down 0.1 percent, at 21,345.22 points. Benchmarks in mainland China and Taiwan were also lower. The Shanghai Composite dropped 1.1 percent, to 2,023.40.

“The slowdown of growth in China is still the main concern,” said Linus Yip, a strategist at First Shanghai Securities in Hong Kong.

In other markets, the benchmark crude contract for August delivery was up $1.44 at $107.92 in electronic trading on the New York Mercantile Exchange. The contract rose 48 cents on Wednesday.

The euro fell to $1.3080 from $1.3117 late Wednesday. The dollar rose to 100.60 yen from 99.62 yen.

Article source: http://www.nytimes.com/2013/07/19/business/daily-stock-market-activity.html?partner=rss&emc=rss