Wall St higher after CBO report, durables data

US stocks rose on Wednesday after the Congressional Budget Office offered an upbeat forecast on the worrisome budget deficits and data showed a strong reading on durable goods orders.

In a sign volatility was still a constant, equity indexes rebounded from steep premarket losses following the durables data. All S&P sectors were in positive territory.

The government reported that new orders for long-lasting US manufactured goods surged in July.

The Congressional Budget Office reported that a sweeping US budget deal and lower interest rates will slice projected budget deficits nearly in half over the next 10 years.

The news provided a diversion to investors, fixed on hopes that Federal Reserve Chairman Ben Bernanke would announce new stimulus for a struggling US economy in a speech in Friday. Hopes for such a plan fueled a 3% rally in Tuesday's session.

Bernanke, however, is most likely to outline gradualist measures, which would disappoint investors looking for a big bang approach, such as a fresh round of bond buying.

"The durable goods data looked very decent, but we'll need a bigger catalyst to move higher," said Randy Bateman, chief investment officer of Huntington Asset Management in Columbus, Ohio, which oversees USD 14.5 billion. "It would be nice to get one from Bernanke, but I don't think that's likely."

The Dow Jones industrial average was up 104.52 points, or 0.94%, at 11,281.28. The Standard & Poor's 500 Index rose 12.25 points, or 1.05%, at

1,174.60. The Nasdaq Composite Index added 22.70 points, or 0.93%, at 2,468.76.

Bank of America Corp rose 8.5% to USD 6.83, reversing losses on Tuesday, when the Dow component hit a 2-1/2-year lows on fears it may have to raise massive amounts of capital. BofA shares remain down more than 30% so far this month.

Banks were the day's top risers, with the S&P financial index up 2.4%. JPMorgan Chase & Co added 2.9% to USD 35.80.

In earnings news, Toll Brothers Inc reported third-quarter earnings that rose from the prior year but narrowed its home delivery order for the full year. The stock rose 4% to USD 15.36.