Investing.com - U.S. stocks rose on Thursday after Federal Reserve Chair Nominee Janet Yellen told lawmakers she remains committed to propping up the economy with monetary stimulus measures until data shows recovery is gaining steam.
Stimulus tools such as the Fed's USD85 billion in monthly bond purchases aim to spur recovery by driving down interest rates, boosting stock prices in the process.
At the close of U.S. trading, the Dow Jones Industrial Average finished up 0.34%, the S&P 500 index rose 0.48%, while the Nasdaq Composite index rose 0.18%.
Yellen told the Senate Banking Committee that the U.S. central bank's USD85 billion in monthly bond purchases have and will continue to support the economy until more sustained recovery becomes evident.
"The Federal Reserve is using its monetary policy tools to promote a more robust recovery. A strong recovery will ultimately enable the Fed to reduce its monetary accommodation and reliance on unconventional policy tools such as asset purchases," Yellen said in her speech.
"I believe that supporting the recovery today is the surest path to returning to a more normal approach to monetary policy," Yellen added, though she stressed the economy still has a way to go.
"We have made good progress, but we have farther to go to regain the ground lost in the crisis and the recession," Yellen said.
"Unemployment is down from a peak of 10 percent, but at 7.3 percent in October, it is still too high, reflecting a labor market and economy performing far short of their potential. At the same time, inflation has been running below the Federal Reserve's goal of 2 percent and is expected to continue to do so for some time."
Elsewhere in the U.S., the Labor Department reported earlier that the number of individuals filing for initial jobless benefits last week declined by 2,000 to a seasonally adjusted 339,000.
Analysts had expected U.S. jobless claims to fall by 11,000.
A separate report showed that the U.S. trade deficit widened to USD41.8 billion in September from a deficit of USD38.7 billion in August.
Analysts were expecting a USD39.0 billion deficit.
Dampening moods slightly were reports that retailers Wal-Mart Stores and Kohl's cut earnings forecasts, while tech giant Cisco issued a revenue warning and disappointing earnings that sent its share prices plunging.
Leading Dow Jones Industrial Average performers included Home Depot, up 1.70%, Walt Disney, up 1.49%, and Boeing, up 1.44%.
The Dow Jones Industrial Average's worst performers included Cisco, down 10.94%, Intel, down 0.87%, and IBM, down 0.67%.
European indices, meanwhile, finished higher.
After the close of European trade, the EURO STOXX 50 rose 1.06%, France's CAC 40 rose 1.04%, while Germany's DAX 30 rose 1.05%. Meanwhile, in the U.K. the FTSE 100 finished up 1.54%.
On Friday, the U.S. is to round up the week with data on manufacturing activity in the New York region, as well as reports on industrial production and import prices.
Stimulus tools such as the Fed's USD85 billion in monthly bond purchases aim to spur recovery by driving down interest rates, boosting stock prices in the process.
At the close of U.S. trading, the Dow Jones Industrial Average finished up 0.34%, the S&P 500 index rose 0.48%, while the Nasdaq Composite index rose 0.18%.
Yellen told the Senate Banking Committee that the U.S. central bank's USD85 billion in monthly bond purchases have and will continue to support the economy until more sustained recovery becomes evident.
"The Federal Reserve is using its monetary policy tools to promote a more robust recovery. A strong recovery will ultimately enable the Fed to reduce its monetary accommodation and reliance on unconventional policy tools such as asset purchases," Yellen said in her speech.
"I believe that supporting the recovery today is the surest path to returning to a more normal approach to monetary policy," Yellen added, though she stressed the economy still has a way to go.
"We have made good progress, but we have farther to go to regain the ground lost in the crisis and the recession," Yellen said.
"Unemployment is down from a peak of 10 percent, but at 7.3 percent in October, it is still too high, reflecting a labor market and economy performing far short of their potential. At the same time, inflation has been running below the Federal Reserve's goal of 2 percent and is expected to continue to do so for some time."
Elsewhere in the U.S., the Labor Department reported earlier that the number of individuals filing for initial jobless benefits last week declined by 2,000 to a seasonally adjusted 339,000.
Analysts had expected U.S. jobless claims to fall by 11,000.
A separate report showed that the U.S. trade deficit widened to USD41.8 billion in September from a deficit of USD38.7 billion in August.
Analysts were expecting a USD39.0 billion deficit.
Dampening moods slightly were reports that retailers Wal-Mart Stores and Kohl's cut earnings forecasts, while tech giant Cisco issued a revenue warning and disappointing earnings that sent its share prices plunging.
Leading Dow Jones Industrial Average performers included Home Depot, up 1.70%, Walt Disney, up 1.49%, and Boeing, up 1.44%.
The Dow Jones Industrial Average's worst performers included Cisco, down 10.94%, Intel, down 0.87%, and IBM, down 0.67%.
European indices, meanwhile, finished higher.
After the close of European trade, the EURO STOXX 50 rose 1.06%, France's CAC 40 rose 1.04%, while Germany's DAX 30 rose 1.05%. Meanwhile, in the U.K. the FTSE 100 finished up 1.54%.
On Friday, the U.S. is to round up the week with data on manufacturing activity in the New York region, as well as reports on industrial production and import prices.