US stocks rallied to new 2009 highs on Friday on positive comments from Federal Reserve Chairman Ben Bernanke and data showing existing home sales rose for the fourth consecutive month. The S&P 500 and the Nasdaq hit 10-month intraday highs, while the Dow industrials rose to their highest level in nine months.
"The fact that Bernanke suggests a recovery is under way and that it won't likely to be overly strong initially makes the market comfortable the Fed won't raise rates prematurely. That's a good environment for stocks," said Charles Lieberman, chief investment officer at Advisors Capital Management in Paramus, New Jersey.
Sales of previously owned US homes jumped 7.2 percent in July, the fastest sales pace in nearly two years. On an annual rate, sales rose to 5.24 million units, better than expected. The data sent the Dow Jones US Home Construction index up 3.4 percent to 293.46. Among the big US home builders, D.R. Horton advanced 4 percent to $12.73, while Toll Brothers gained 3.8 percent to $22.74.
The Dow Jones industrial average rose 138.75 points, or 1.48 percent, to 9,488.80. The Standard & Poor's 500 Index added 16.47 points, or 1.63 percent, to 1,023.84. The Nasdaq Composite Index climbed 26.69 points, or 1.34 percent, to 2,015.91.