Stocks rally on hopes of fed stimulus

10:00 PM hopes, rally, stimulus, stocks No Comments

Shares rose Tuesday hoping that the Federal Reserve will agree to politician, on the extension of the stimulus as the economy struggles to recover.

A sharp decline in the German sentiment indicators, in addition to stubbornly high Spanish bond yields, raised expectations for market-friendly ideas from European decision-makers as well.

"Went to the heights of the day, and we have the Fed tomorrow." This is a rescue mission, Central Bank generosity bounce and we will see what follow through (admission) after the Fed morning and what is always from the ESM ", said Peter Boockvar, equity strategist at Miller tobacco & co in New York."

British media earlier, German Chancellor Angela Merkel was balanced had said the reports, to Europe's dual use bailout funds, known as the European facility for financial stability and the European stability mechanism or the EFSF, the ESM, the debts of the countries buying up such as Italy and Spain, and had discussed the plans at the Summit. But a German Government official told Reuters that there was no discussion at a G20 Summit in Mexico this week about the use of Europe's rescue purchase means the bonds of the affected members of the euro zone.

The Dow Jones industrial average closed the day up to 96 points, more than 157 points have increased, earlier in the session. The S & P 500 has gained a five-month low hit earlier in June more than 7 percent. But the strong gains also leave the market vulnerable, if the outcome of the Fed meeting Wednesday does not meet the expectations of the market.

On Tuesday began the Federal open market Committee the first day of a two-day meeting on interest rate policy. The meeting began with expectations that the Fed can expand their "operation twist" program, their efforts to reduce the long-term borrowing costs.

"Some are people expect answer on the Fed morning and are buying or cover shorts in anticipation of that," said Paul Zemsky, Director of asset allocation at ING investment management in New York. "There is a risk that the market gets disappointed."

Spanish Government bond yields facilitated sale, which tempted investors raise higher yields slightly after the 3 billion euro in a short-term debt. However survive his 10-year bonds and bonds over 7 percent, investors concerned about how long fourth largest economy of the eurozone without outside help can.

In Greece lender of the country on a rigorous program that keeps both promised the country from bankruptcy soon to form a coalition government parties and concessions from the EU and IMF and plug into a very long recession to search.

Oracle Corp. rose a day after the results of three days earlier than planned release it stronger than expected quarterly profit, reported, after news of the pending departure of senior concerns the sale was heated, that business is stagnant.

Walgreen Co. fell after the pharmacy chain quarterly results reported and said that it would buy a 45-percent stake in Alliance Boots for $6,70 billion in a bar and floor business.

FedEx Corp. rose after the package delivery company achieved in the fourth quarter and provided an Outlook for the first quarter and 2013.

The Department store operator was shares of j.c Penney a day after its President abruptly after a botched campaign.

Housing starts fell in may from a 3-1/2 year high, but allowed to build new houses strongly increased, suggesting that the housing recovery on track remains showed U.S. economic data.

Reuters contributed to this report.