Bernanke's recession hope boosts Wall Street

Wall Street shares were higher today after comments from Federal Reserve chairman Ben Bernanke that the recession was probably over.

Better news on retail sales and manufacturing also helped the Dow Jones Index rise 56.61 – 0.6 % – to 9,683.41, its highest close since October 6.

The S&P 500 index rose 3.29 to 1,052.63, while the Nasdaq rose 10.86 to 2,102.64.

Materials and industrial companies such as Alcoa and Caterpillar pulled the Dow higher because manufacturers are expected to be among the early beneficiaries if the economy strengthens.

Hopes for a rebound grew after the US Government reported that retail sales jumped in August by the biggest amount in three years. The Fed’s index of manufacturing in the New York region rose to its best level since late 2007.

Meanwhile Mr Bernanke cheered investors by saying that the worst recession since the 1930s has “very likely” ended.

His assessment of the economy was welcomed by investors who have been placing big bets on a recovery.

Investors shrugged off news that wholesale prices rose 1.7 % last month and disappointing earnings from two major retailers, Best Buy Co and Kroger Co also failed to push the stock market off course.

“You want to say that the market is a little bit tired after the run we’ve had yet we continue to grind higher,” said Ryan Larson, senior equity trader at Voyageur Asset Management.

Two stocks rose for every one that fell on the New York Stock Exchange.