Stocks jump after Fed says it will buy Treasurys
Stocks rise after Federal Reserve says it will buy up to $300B in Treasurys
* Madlen Read, AP Business Writer
* Wednesday March 18, 2009, 2:53 pm EDT
NEW YORK (AP) -- The Federal Reserve is keeping Wall Street's big rally alive with news that it will start buying Treasurys to help open up tight credit markets.
The central bank said it will purchase up to $300 billion of longer-term Treasury securities over the next six months. The decision sent both government bonds and bank stocks soaring.
The Fed's announcement accompanied its decision to keep interest rates at historically low levels. It also reiterated Chairman Ben Bernanke's prediction made Sunday night on the CBS program "60 Minutes" that government steps should return the economy to sustainable growth.
In midafternoon trading, the Dow Jones industrial average rose 133.17, or 1.9 percent, to 7,528.87.
Broader stock indicators jumped, too. The Standard & Poor's 500 index added 21.15, or 2.72 percent, to 799.27, and the Nasdaq composite index rose 37.91, or 2.59 percent, to 1,500.02
Stocks have risen for five out of the last six days. Since the market rally began last week, the Dow has jumped 13 percent, and the S&P 500 has soared 15 percent.
