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Wall Street surges as Yellen speaks before Congress

English.news.cn   2014-02-12 06:17:01

NEW YORK, Feb. 11 (Xinhua) -- U.S. stocks soared Tuesday, logging the first four-day winning streak this year, as Federal Reserve Chair Janet Yellen said the Fed will likely keep the plan of cutting stimulus given the strengthening economy in her first testimony in Congress as the Fed's head.

The Dow Jones Industrial Average rose 192.98 points, or 1.22 percent, to 15,994.77. The S&P 500 climbed 19.91 points, or 1.11 percent, to 1,819.75. The Nasdaq Composite Index jumped 42.87 points, or 1.03 percent, to 4,191.04.

"The pickup in economic activity has fueled further progress in the labor market," said Yellen Tuesday when reporting economic situation and monetary policy before the House Financial Services Committee.

She vowed to stay the course on Ben Bernanke's policies by trimming bond buying program in "measured steps," emphasizing that only a "notable change in the outlook" for the U.S. economy could lead to unwind the tapering pace.

Yellen also stressed that "the recovery in the labor market is far from complete," which meant that the U.S. central bank would sustain accommodative monetary policy for a long time.

Yellen's remarks lifted market sentiment as traders got clear policy stance from what the new chair of the Fed said in her testimony.

The Fed twice announced reductions of its monthly bond purchases following policy meetings in December and January, lowering the size of its stimulus program from 85 billion U.S. dollars to 65 billion dollars starting February.

Moreover, U.S. House Speaker John Boehner on Tuesday told House Republicans that he would bring legislation to a vote that would raise the government's debt ceiling with no conditions attached, which also added to the optimistic sentiment.

On the economic front, U.S. wholesale inventories, a key component of gross domestic product changes, rose 0.3 percent in December, according to the Commerce Department, falling short of market expectations.

The CBOE Volatility Index, widely considered as a fear gauge of the market, dropped 4.91 percent to 14.51.

In other markets, U.S. oil price dropped slightly on profit taking Tuesday. Light, sweet crude for March delivery moved down 12 cents to settle at 99.94 dollars a barrel on the New York Mercantile Exchange, while Brent crude for March delivery gained 5 cents to close at 108.68 dollars a barrel.

Gold futures on the COMEX division of the New York Mercantile Exchange continued to rise Tuesday, with the most active gold contract for April delivery up 15.1 dollars to settle at 1,289.8 dollars per ounce.

The U.S. dollar traded mixed against major currencies Tuesday on Yellen's speeches. In late New York trading, the euro fell to 1. 3638 dollars from 1.3642 dollars of the previous session, and the British pound went up to 1.6449 dollars from 1.6406 dollars.

Editor: Mu Xuequan
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