Stocks rise following expansion in manufacturing

Stocks mostly higher on Wall Street following strong report on US manufacturing

Federal Reserve Chairman Ben Bernanke, shown at an earlier event, offered a sharp defense today of the Federal Reserve's bold policies to stimulate the weak economy.

NEW YORK -- Stocks closed mostly higher today on Wall Street following a surprisingly strong increase in U.S. manufacturing last month.

The expansion came after four months of declines.

The Dow Jones industrial average rose 78 points to close at 13,515. The Dow had been up as much as 161 points but gave up most of that gain in the afternoon.

The rally faded after Fed Chairman Ben Bernanke said the central bank needs to keep interest rates low because the economy isn't growing fast enough to reduce high unemployment.

The Standard & Poor's 500 index rose four points to 1,444. The Nasdaq composite fell three to 3,114.

Three stocks rose for every two that fell on the New York Stock Exchange. Trading volume was lighter than average at 3.3 billion shares.