Stocks edge up
NEW YORK — Some soothing words from Federal Reserve Chairman Ben Bernanke pushed the stock market to slender gains on Wednesday.
Higher earnings for several major companies also helped.
Bernanke said that the U.S. central bank had no firm timetable for cutting back on its bond purchases. The Fed would consider reducing its stimulus program if the economy improves, but Bernanke emphasized in his testimony to Congress that the reductions were “by no means on a preset course.”
The central bank is currently buying $85 billion of bonds a month to keep interest rates low and encourage borrowing. Concerns that the Fed was poised to start easing back on that stimulus before the economy had recovered sufficiently caused the stock market to pull back in June.
The concern has been that “the Fed was going to dial the (stimulus) down to zero regardless how the economy was doing,” said Phil Orlando, chief market strategist at Federated Investors. “I don’t think that’s the case at all...the Fed is going to evaluate the economic landscape,” before it cuts its stimulus, Orlando said.
The Standard & Poor’s 500 index climbed 4.65 points, or 0.3 percent, to 1,680.91. The Nasdaq composite rose 11.50 points, or 0.3 percent, to 3,610.
The Dow Jones industrial average rose 18.67 points, or 0.1 percent, to 15,470.52.
The Dow was held back by American Express and Caterpillar. The credit card company’s stock slumped $1.47, or 1.9 percent, to $76.80 after European regulators proposed to cap the lucrative processing fees the card company imposes.
Caterpillar fell $1.50, or 1.7 percent, to $86.67 after prominent short-seller Jim Chanos said he was shorting the stock because it was exposed to a slump in the mining industry. In a presentation at the ‘Delivering Alpha’ conference, broadcast by CNBC, Chanos said Caterpillar was “tied to the wrong products, at the wrong time.”