US stocks rallied to their highest levels of the year on Friday after Federal Reserve chairman Ben Bernanke delivered an upbeat forecast for the economy and said the US is on the cusp of a recovery.
The Dow Jones industrial average gained 156 points to 9,506. The S&P500 Index rose 19 points to 1,026 and the NASDAQ added 32 points to 2,021.
Also boosting the market on Friday was an economic report which showed stronger sales of existing homes. Sales of previously owned single-family homes were up 7.2% in July compared with the month before.
In other economic news, the number of states showing a decline in the unemployment rate tripled in July from June levels.
In company news: J.M. Smucker (NYSE: SJM) shares added 4.28% to $54.10. The food company reported first-quarter earnings that beat expectations and also affirmed its full-year outlook.
Anntaylor Stores (NYSE:ANN) shares rose 4.84% to $13.44. The women's apparel retailer reported second-quarter results that beat Wall Street’s expectations. The company says it will continue to focus on managing inventory and cutting costs, as sales trends are likely to improve only slightly in the third quarter. American International Group (NYSE:AIG) shares add 1.7% to $32.85. A federal lawsuit has been dismissed that accused the troubled insurer of fraudulently shortchanging state workers' compensation pools out of more than $1 billion.
Gap (NYSE:GPS) shares rose 3.34% to $19.48 after the clothing retailer reported higher quarterly earnings on Thursday - that topped forecasts but it also revealed that sales fell from a year ago.
Checking the NASDAQ Top 100: Making the most gains overnight was Paccar which added 4.64% to $37.18. Staples and Comcast were the next best performers. Looking at the downside, Intuitive Surgical was the worst performer, down 7.23% to $28.62, followed by First Solar and Illumina.
