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U.S. stocks rebound after Yellen speech

Xinhua, August 30, 2016 Adjust font size:

U.S. stocks rose Monday as Wall Street reassessed the possibility of a September rate hike after Friday' s highly-watched remarks from U.S. Federal Reserve Chair Janet Yellen.

The Dow Jones Industrial Average rose 107.59 points, or 0.58 percent, to 18,502.99. The S&P 500 added 11.34 points, or 0.52 percent, to 2,180.38. The Nasdaq Composite Index increased 13.41 points, or 0.26 percent, to 5,232.33.

"In light of the continued solid performance of the labor market and our outlook for economic activity and inflation, I believe the case for an increase in the federal funds rate has strengthened in recent months," Yellen addressed central bankers at a conference in Jackson Hole, Wyoming, on Friday.

Pointing to solid growth in household spending and a strengthening job market, Yellen said the U.S. economy is "now nearing" the Fed's statutory goals of maximum employment and price stability.

Analysts said it's possible for the Fed to hike interest rates as soon as September. But about 71 percent of 62 economists surveyed by the Wall Street Journal this month believed the Fed will wait until December to raise rates.

Market expectations for a Fed rate hike in September were at 24 percent Monday, after ending near 30 percent Friday, according to the CME Group's FedWatch tool.

On the economic front, U.S. personal income in July increased by 71.6 billion U.S. dollars, or 0.4 percent, and personal consumption expenditures increased by 42.0 billion dollars, or 0.3 percent, reported the Commerce Department on Monday. Both figures were in line with market estimates.

Meanwhile, investors also kept a close eye on Friday' s nonfarm payrolls report for August. Fed Vice Chairman Stanley Fischer said last Friday that August jobs report would weigh on the Fed's decision to increase rates. Endit