Stocks Rebound as Stimulus Hopes Offset China, U.S. Budget Concerns
NEW YORK (TheStreet) -- Major U.S. stock averages rose Monday as confidence about continued stimulus support from global central banks offset worries surrounding the Chinese government's five-point plan to curb rising home prices and U.S. budget impasse.
During a conference in Washington Monday, Federal Reserve Vice Chair Janet Yellen gave dovish remarks that were in line with Chairman Ben Bernanke's monetary policy testimony last week
"At present, I view the balance of risks as still calling for a highly accommodative monetary policy to support a stronger recovery and more-rapid growth in employment," she said.
In Japan, the Nikkei Average in Japan finished up 0.4% as Haruhiko Kuroda, Bank of Japan governor-nominee, advocated aggressive measures to overcome deflation.
The Dow Jones Industrial Average rose 38.16 points, or 0.27%, to settle at 14,128. The blue-chip index booked its second highest close ever on Monday.
United Technologies shares retreated by more than 1% after The Wall Street Journal reported the company's Pratt & Whitney subsidiary had broken up an alleged fraudulent-testing scheme by a sister United Technologies unit, affecting tens of thousands of engine parts.
Advancers edged past decliners by a ratio of 1.3-to-1 on the Big Board and 1.2-to1 Nasdaq. Volumes rose to 3.37 billion shares on the New York Stock Exchange and 1.71 billion shares on the Nasdaq.
Sector action was mixed in the broader market. Health care, transportation, utilities and consumer staples were among the sectors that advanced. Energy, basic materials and capital good were among the sectors that retreated.
For much of Monday, stocks were trading in the red amid concerns that China's property bubble might soon burst.