By Victor Reklaitis, MarketWatch
NEW YORK (MarketWatch) -- U.S. stocks pared gains on Wednesday
after Federal Reserve Chairman Ben Bernanke said tapering of the
central bank's bond buying could occur in the "next few
meetings."
The Dow Jones Industrial Average (DJI) rose 76 points, or 0.5%,
to 15,463. The blue-chip index had been up nearly 155 points, or
1%, but it gave up some ground after Bernanke began responding to
lawmakers' questions.
The Standard & Poor's 500 Index (SPX) gained 8 points, or
0.5%, to 1,677. The Nasdaq Composite (RIXF) added 11 points, or
less than 0.3%, to 3,513.
Bernanke started testifying at 10 a.m. Eastern before the Joint
Economic Committee of Congress. He warned that premature tightening
in policy could strangle the economic recovery, sending the main
stock indexes to their session highs. Lawmakers then tried to nail
down when the Fed will taper its bond-buying program, with one
official asking if it could occur before Labor Day. Bernanke
responded by saying that the Fed could slow down its asset
purchases in its next few meetings. Follow along with MarketWatch's
live blog and video of Bernanke's appearance.
"The one and only thing at the moment is Mr. Bernanke's
presentation to Congress," said Mark Luschini, chief investment
strategist at Janney Montgomery Scott. "He indicated continued
leniency with regard to Fed policy given that economic conditions
aren't yet sturdy enough to support its withdrawal."
On Tuesday, two other Fed officials provided some soothing
commentary about sticking with the bond-buying program, helping to
lift stocks to record highs.
The National Association of Realtors issued April data for
existing-home sales. The rate was 4.97 million, roughly in line
with expectations. Economists polled by MarketWatch had expected a
seasonally adjusted annual rate of 5 million.
Wednesday's other key news will include the 2 p.m. Eastern
release of minutes from the Federal Open Market Committee's April
30-May 1 meeting.
On the earnings front Wednesday, Lowe's Cos. (LOW) gained 1% in
morning trade. The home-improvement retailer had been down in
premarket trade after it posted worse-than-expected quarterly
results before the opening bell, but encouraging comments from the
company have boosted the stock during the regular session.
While sales and profit disappointed after unseasonably cold
weather hurt demand for garden and other outdoor products, Lowe's
said sales have turned positive in April and May as the weather got
warmer. The company also expects a pick up in demand as the housing
market rebounds.
Target Corp. (TGT) lost ground, falling 3%, as the big-box
retailer's quarterly report disappointed as well. But home builder
Toll Brothers Inc. (TOL) advanced 8% as its revenue came in well
above forecasts.
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