CNN Money: Dow Jumps on Dovish Bernanke!

US stocks rallied Monday after Fed chairman Ben Bernanke's comments on the job market gave investors reason to believe interest rates will stay low. The Dow Jones industrial average rose 161 points, or 1.2% to end at 13,242. American Express led gainers on the DOW after the company hiked its quarterly dividend payment 11% to 20 cents per share. It was the biggest one-day gain for the DOW since January 3, when the index rose to nearly 180 points. In a speech to fellow economists, Bernanke said: "We cannot yet be sure that the recent pace of improvement in the labor market will be sustained." He added that the Fed's "accommodative monetary policies" should help reduce high unemployment over time. The comments reaffirm investors' expectation that the central bank will keep interest rates low for a long time, and that the Fed will act if the economy deteriorates. "We got some clarity on what Bernanke believes the economic cycle will look like," said Frank Davis, director of sales and trading at LEK Securities. While stocks have rallied this year on growing optimism about the economy, the Fed has maintained a cautious outlook. The central bank has pledged to keep interest rates near historic lows until late 2014. Traders said stocks are being supported by the combination of improving economic data and tacit support from the Fed. So far in 2012, the S&P 500 has gained 12%, the Dow is 7% higher, and the Nasdaq is up nearly 18%. But the gains were exaggerated by positioning ahead of the quarter's end, said Boockvar, chief market strategist with Miller Taback & Co.