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Dow, S&P snap six week winning streak

08-25-2012 08:55 BJT

NEW YORK, Aug. 24 (Xinhua) -- U.S. stocks rebounded on Friday, wrapping up a dismal week on positive note, but major indexes were still lower for the whole week.

When then market closed, the Dow Jones Industrial Average jumped 100.51 points, or 0.77 percent, to 13,157.97. The Standard &Poor's 500-stock Index gained 9.05 points, or 0.65 percent, to 1, 411.13. The Nasdaq Composite Index climbed 16.39 points, or 0.54 percent, to 3,069.79.

Friday's rally came after the surface of a letter from Federal Reserve Chairman Ben Bernanke to Republican Representative Darrell Issa, saying that he thinks the central bank can do more to help the economy.

"There is scope for further action by the Federal Reserve to ease financial conditions and strengthen the recovery," Bernanke says in the letter.

The U.S. central bank head also noted that the Fed has had to deploy other means to strengthen the economy, such as buying bonds, as the interest rates have already stayed at record lows.

His words fueled the expectations for further stimulus and push major indexes higher.

Also adding to the gains, news showed the European Central Bank is discussing yield-band targets under a new bond-buying program, which could help contain borrowing costs for Greece, Spain and other euro zone countries.

Friday's economic data was mixed, following recent trend and reflecting a sluggish recovery. The Commerce Department said that durable goods orders jumped 4.2 percent on strong demand in July.

However, orders excluding transportation fell 0.4 percent and non-defense capital goods orders excluding aircraft, a more actual gauge for business spending plans, dropped 3.4 percent in July.

Investors have been struggling between downbeat economic data around the world and hopes for more central bank moves.

Volumes were extremely light as most investors kept cautious ahead of the Fed's symposium at Jackson Hole, the U.S. state of Wyoming, where Bernanke and ECB President Mario Draghi are expected to speak.

Many were expecting the Fed to launch a new round of quantitative easing to give the market a lift.

Even with Friday's advance, stocks were still lower for the week. Both the blue-chip Dow and the broader S&P 500 broke a six- week winning streak, losing 0.9 percent and 0.5 percent, respectively. The tech-heavy Nasdaq gave up 0.2 percent after rising five weeks in a row.

In other markets, the U.S. dollar rose against most major currencies in late New York trading and crude oil prices edged down after seesawing as concerns about European debt crisis weighed, while Tropical Storm Isaac was approaching the oil-rich Gulf of Mexico and forced drilling companies to halt production.

Light, sweet crude for October delivery lost 12 cents, or 0.12 percent, to settle at 96.15 dollars a barrel on the New York Mercantile Exchange. But it still posted the fourth straight weekly gains of 14 cents.

Editor:James |Source: Xinhua

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