NEW YORK — Investors have stopped worrying about the Federal Reserve. At least for now.
Stocks rose on Wall Street today as investors judged that the economy still isn’t growing fast enough for the central bank to cut back on its stimulus program.
U.S. manufacturing grew modestly in June after a pickup in new orders and stronger production, according to a private survey. The Institute for Supply Management said its factory index increased to 50.9 in June from 49 in the previous month.
The Standard & Poor’s 500 index logged its first monthly decline since October last month after investors were unsettled by comments from Federal Reserve Chairman Ben Bernanke. Bernanke said in late May that the Fed could ease back on its stimulus this year and end it next year, providing the economy continues to recover.
“The market has maybe stepped back from the knee-jerk reaction that the Fed news provided,” said Jim Russell, a regional investment director at US Bank. “The manufacturing ISM number came in strong enough — not too hot, not too cold.”
If the manufacturing report had been stronger, Russell said, stocks might have fallen as investors speculated that the Fed would be inclined to ease back on its stimulus sooner.
A separate report on construction spending added to the picture of a gradually improving economy. Construction spending rose 0.5 percent in May compared with April when spending was up 0.1 percent, the Commerce Department said today.
The central bank is currently buying $85 billion of bonds a month to keep interest rates low and encourage borrowing and spending. That stimulus has been a major factor supporting a rally in stocks this year. Despite last month’s loss, the S&P 500 is still up 13.7 percent this year.
The Dow Jones gained 155 points, or 1 percent, to 15,064 as of noon Eastern Daylight Time. The Standard & Poor’s 500 index rose 19 points, or 1.2 percent, to 1,625. The Nasdaq composite gained 46 points, or 1.3 percent, to 3,449.
Eight of the 10 industry groups that make up the S&P 500 index rose, led by materials companies, a category that includes miners and chemical makers. Utilities and phone companies were the only group to decline.
Investors will also turn their focus to corporate earnings next week. Record earnings this year helped push the market to a record high in May. Alcoa, traditionally the first company in the Dow index to report earnings, will release its second-quarter report July 8.
U.S. stocks also followed global markets higher. Japan’s Nikkei 225 rose 1.3 percent, boosted by signs of improvement in Japan’s economy.
In Europe, stock indexes rose after a mixed set of economic indicators for the region. While unemployment in the 17 countries that use the euro rose to another record high in May, manufacturing picked up in Britain, France and Italy and stabilized in Spain.
Germany’s DAX index rose 0.3 percent and Britain’s FTSE 100 index climbed 1.5 percent.
The yield on the 10-year Treasury note was unchanged from Friday at 2.49 percent. The note’s yield surged to 2.66 percent last Monday as investors worried that the Fed was poised to reduce on its bond purchases. The yield on the 10-year Treasury note is used to set interest rates on many kinds of loans including home mortgages.
In commodities trading, the price of oil climbed $1.47, or 1.5 percent, to $97.83 a barrel. The price of oil rose on concerns that unrest in Egypt, the largest Arab nation, could spread and affect the transport of oil supplies in the Middle East and Africa.
Gold rose $35, or 2.9 percent, to $1,259 an ounce.
Trading will be curtailed this week due to the Independence Day holiday Thursday. The New York Stock Exchange will close at 1 p.m. on Wednesday and reopen on Friday.
The dollar edged lower against the euro and rose against the Japanese yen.
Among stocks making big moves:
— Onyx Pharmaceuticals surged $44.31, or 51 percent, to $131 after the company rejected a takeover bid from Amgen. Onyx said other companies have expressed interest in a buyout.
— Cablevision rose $1.18, or 7 percent, to $18 after Reuters reported that Time Warner Cable is considering making a bid for the company.
— Best Buy rose $1.97, or 7.2 percent, to $29.10 after Credit Suisse resumed its coverage of the stock with an “outperform” rating and a target price of $42. Analysts at the investment bank believe that the company’s new approach to serving customers will help it increase its earnings.