Stocks enjoy best month since Jan. on Fed pledge
NEW YORK -- After a day of stalled rallies, the stock market closed out July with its best monthly gain since January.
The Standard & Poor's 500 index ended the month 4.95 percent higher. That's the biggest increase since January, when it rose 5.04 percent. The Dow Jones industrial average also had its best month since January.
Markets surged in July after Fed Chairman Ben Bernanke assured investors that the central bank wouldn't pull back on its stimulus program until the economy was strong enough. The central bank is buying $85 billion of bonds a month to keep down interest rates to encourage borrowing and hiring.
On Wednesday, the Fed reaffirmed its commitment to support the economy in a statement released after the end of a two-day meeting. The central bank dropped hints that it might need to maintain its stimulus, and slightly downgraded its assessment of U.S. economic growth from "moderate" to "modest."
That initially gave stocks a boost, pushing the S&P 500 within two points of breaching the 1,700 level for the first time in afternoon trading. But the rally faded in the final hour, leaving the S&P flat at the end of the day.
The Standard & Poor's 500 index ended little changed at 1,685.73. The Dow Jones industrial average ended the day 21 points lower, or 0.1 percent, at 15,499.54.
The Nasdaq composite gained 9.90 points, or 0.7 percent, to 3,626.37.