Wall St rebounds as Bernanke calms nerves By Ellis Mnyandu 57 minutes ago Stocks rose on Wednesday as Federal Reserve Chairman Ben Bernanke's comments that the economy was poised to grow moderately reassured investors, a day after the Dow's worst slide since the September 11 attacks. Investors zeroed in on defensive stocks, snapping up shares of companies such as Procter & Gamble Co. (NYSE:PG - news) and Altria Inc. (NYSE:MO - news), the parent of cigarette maker Philip Morris. Health-care stocks also rose, with shares of Merck & Co. (NYSE:MRK - news) up 2.9 percent and among the Dow's biggest gainers, after the drugmaker increased its 2007 earnings outlook. "Bernanke doesn't want to sound like he's panicked about the economy," said Marc Pado, U.S. market strategist in the San Francisco office of Cantor Fitzgerald & Co. "So he's reassuring today, but it's nothing different. The Fed is going to hold rates at 5.25 percent. We've also seen the yield on the 10-year (Treasury note) pop back up, reflecting that yesterday's panic was overdone." The Dow Jones industrial average (^DJI - news) was up 79.31 points, or 0.65 percent, at 12,295.55. The Standard & Poor's 500 Index (^SPX - news) was up 10.77 points, or 0.77 percent, at 1,409.81. The Nasdaq Composite Index (^IXIC - news) was up 14.96 points, or 0.62 percent, at 2,423.15. The yield on the benchmark 10-year U.S. Treasury note was at 4.57 percent on Wednesday, up from Tuesday's 4.50 percent, which was the lowest since late December. The note's price, which moves inversely to its yield, was down 14/32 at 100-14/32, reflecting that investors had moved some money back out of bonds on Wednesday as some fears subsided. Stocks' steep drop on Tuesday wiped out the market's gains for 2007. But with Wednesday's rebound, the Nasdaq recovered in early afternoon to show a gain of 0.3 percent for the year, while both the S&P 500 and the Dow Jones industrial average remained in the red. Besides Bernanke, investors also drew support from an overnight recovery in China's stock market where a sell-off on concerns about a possible government crackdown on speculation leading to overinflated stock valuations had triggered Tuesday's global rout in equity markets. Testifying before the House Budget Committee, Bernanke said there did not seem to be any single trigger for the drop in the market. Procter & Gamble's stock climbed 3.6 percent to $63.46 on the New York Stock Exchange. The company said it withdrew a euro bond issue. The stock was the biggest advancer in both the Dow and the S&P 500. On the Nasdaq, shares of wireless chip maker Qualcomm Inc. (Nasdaq:QCOM - news) rose 1.4 percent to $40.67 as investors snapped up semiconductor stocks, which were among Tuesday's worst decliners. In Wednesday's session, Qualcomm was among the biggest positive influences on the Nasdaq 100. Shares of Merck & Co. jumped 2.9 percent to $44.45 on the NYSE. However, weak economic data limited Wednesday's gains. The U.S. Commerce Department reported sales of new single-family homes dropped to a slower-than-expected pace in January and the National Association of Purchasing Management-Chicago said its index of Midwest manufacturing was at its lowest level since October 2002. In addition, the government reported that the U.S. economy grew at a weaker-than-expected rate in the final three months of last year as businesses built fewer inventories and consumers spent less. Gross domestic product or GDP, the broadest measure of overall economic activity within U.S. borders, expanded at an annual rate of 2.2 percent in the fourth quarter of 2006. That was revised down from the 3.5 percent advance in the government's previous estimate. "If those numbers were good, the market would be up 250 points" on the Dow Jones average, Pado said. Pado said he sees near-term support at 12,000 on the Dow, suggesting there could yet be more selling to come and it would probably be that level that draw in more bargain hunters.