Stocks are on the mend Monday following a week that undid all of the progress of 2010. An announcement that Federal Reserve Board Chairman, Ben Bernanke would be appointed to another term made investors feel secure in the near-zero interest rate.
Major Stock indices made gains on Monday after Senate Committee chairman Max Baucus, confirmed that Bernanke had enough votes to win another four-year appointment. Had he lost reappointment and some Senate members suspected he would last week, Bernanke’s term would end Sunday.
In early afternoon trading, the Dow tacked on 61.52, or 0.6 percent, to 10,234.50. Last week, it fell 5.2 percent between Wednesday and the closing bell on Friday. The Standard & Poor's 500 index has also done remarkably well on Monday adding 8.85, or 0.8 percent, to 1,100.61. The Nasdaq composite index also made gains following Bernanke’s pledge to maintain low interest rates, rising 9.37, or 0.4 percent, to 2,214.66.
Bernanke gained favor for his contribution to preventing a total financial collapse at the height of the recession, but the importance of his reappointment to the market goes beyond his accomplishments. Filling his position with someone new and less familiar with the current economic situation would open the already unstable economy up to fresh dangers few are confident enough to face.
A vote will occur over the next week.
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