U.S. Stocks Extend Gains as Bernanke Signals Continued StimulusJeremy Herron
U.S. stocks extended gains after Federal Reserve Chairman Ben Bernanke said the economy remains hampered by high unemployment and government spending cuts, and tightening policy too soon would endanger the recovery.
The Standard & Poor’s 500 Index rose 0.5 percent to 1,676.89 at 10:03 a.m. in New York.
“A premature tightening of monetary policy could lead interest rates to rise temporarily but would also carry a substantial risk of slowing or ending the economic recovery and causing inflation to fall further,” Bernanke said today in testimony prepared for a hearing at the Joint Economic Committee of Congress in Washington. Monetary policy is providing “significant benefits,” he said.
Stocks also rose as sales of previously owned U.S. homes climbed in April to the highest level in more than three years as housing continued to gain momentum.