Stocks rallied on Monday after Federal Reserve Chairman Ben Bernanke suggested the central bank would continue supportive monetary policies even as the unemployment rate improves.
The economy needs to grow more quickly if it is to produce enough jobs to bring down the unemployment rate further, Bernanke told a gathering of the National Association for Business Economics.
Further significant improvements in the unemployment rate will likely require a more rapid expansion of production and demand from consumers and businesses, a process that can be supported by continued accommodative policies, he said.
Leo Grohowski, the chief investment officer at BNY Mellon Wealth Management in New York, called the remarks the best of both worlds.
There's optimism that monetary accommodation is alive both here and in Europe, and so long as that is the case markets can continue to have a positive tone, said Grohowski, who helps oversee $168 billion in client assets.
The Dow Jones industrial average was up 107.13 points, or 0.82 percent, at 13,187.86. The Standard & Poor's 500 Index was up 11.78 points, or 0.84 percent, at 1,408.89. The Nasdaq Composite Index was up 26.35 points, or 0.86 percent, at 3,094.27.
The benchmark S&P index fell 0.5 percent last week, a relatively minor decline that was still the biggest weekly slide since the final week of December.
Improving sentiment about the pace of economic growth has kept investors piling into equities. The S&P 500 is near its highest point since May 2008, and the Nasdaq has risen for six straight weeks.
Pending home sales slid 0.5 percent in February, according to the National Association of Realtors, confounding expectations for a rise of 1 percent. Equities were little impacted by the data, though homebuilder D.R. Horton Inc fell 0.6 percent to $15.33.
Lions Gate Entertainment Corp rallied 3.3 percent to $15 after the strong opening to its film The Hunger Games, which made $214 million over the weekend globally.
Cal-Maine Foods Inc reported third-quarter earnings that fell from the prior year on rising feed costs, which the company sees persisting through the summer. Shares fell 3.4 percent to $40.51.
BATS Global Markets Inc on Sunday apologized for a system failure that caused shares in its own initial public offering to erroneously trade for less than a penny on Friday and resulted in Apple Inc's shares being temporarily halted.
Chief Executive Joe Ratterman called the incident a devastating moment, and said the company's withdrawn IPO was on hold for the foreseeable future.
(Editing by Padraic Cassidy)