Wall Street Rallies On Bernanke Testimony As Housing Starts Disappoint

Michael Teague |

Stocks rallied on Wednesday after Fed Chairman Ben Bernanke appeared before the House Financial Services Committee to give testimony about the status of the central bank’s asset-purchasing program.

The Chairman reiterated the Fed’s desire to begin “tapering” the $85 billion per-month quantitative easing program, but also reiterated that any such pull-back would ultimately be tied to economic conditions.

The Standard & Poor’s 500 rose 0.28 percent to 1,680.91, while the Dow Jones Industrial Average was up 0.12 percent to 15,470.52, while the NASDAQ jumped 0.32 percent to end the day at 3,610.

Stocks took comfort in Bernanke’s testimony, even as Commerce Department data was released early in the day indicating that new home construction for the month of June unexpectedly dropped nearly 10 percent from previous month, the largest decrease since August 2012.

Bank Of America closed 2.8 percent higher to $14.31 after the company’s earnings report showed the bank beating earnings-per-share expectations by $0.07 at $0.32 per share. PNC Financial Services ($PNC) and US Bancorp ($USB) also reported earnings beats on Wednesday, but their stocks ended the day lower due to unimpressive revenue growth.

Construction machinery company Caterpillar (CAT) closed the day down 1.7 percent to $86.67 after veteran short-seller Jim Chanos announced that he would be taking a short position on the company’s stock. Chanos cited what he believed to be problematic accounting practices, as well as Caterpillar’s dependence on mining operations for revenue that will likely take a hit from continued slower growth out of China.

Yahoo! (YHOO) soared over 10 percent to close just shy of $30 after the company's earnings report release gave investors confidence that Marissa Mayer's turnaround strategy is steadily improving once dominant firm's outlook for the future.

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of equities.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions. To read our full disclosure, please go to: http://www.equities.com/disclaimer

Companies

Symbol Name Price Change % Volume
PNC PNC Financial Services Group Inc. (The) 112.24 1.16 1.04 195,249
BAC Bank of America Corporation 21.69 0.46 2.14 14,769,595
USB U.S. Bancorp 50.57 0.57 1.14 476,477
CAT Caterpillar Inc. 95.97 0.83 0.87 363,449
ITVI Interact-Tv Inc 0.00 0.00 0.00 0

Comments

Emerging Growth

Beleave Inc.

Beleave Inc is a biotech company. The Company is engaged in the production of medical marijuana under the Marihuana for Medical Purposes Regulations outlined by Health Canada.

Private Markets

Cloudera

Cloudera offers enterprises a new data platform built on the Apache Hadoop open-source software package. Hadoop is a data-management platform that can consolidate data in a single repository for comprehensive…

Pinterest

Pinterest is a visual discovery and planning tool. Users ("Pinners") use the site and apps to get ideas for their future, such as recipes, places to travel, and products to…