US STOCKS-Wall St gains as Summers' exit augurs continued dovish Fed

Mon Sep 16, 2013 10:38am EDT
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* Summers in surprise withdrawal from Fed consideration

* Fed to meet this week for decision on stimulus' future

* Housing-related stocks, semiconductors rally

* Indexes up: Dow 0.9 pct, S&P 0.8 pct, Nasdaq 0.6 pct

By Angela Moon

NEW YORK, Sept 16 (Reuters) - U.S. stocks rose on Monday after former Treasury Secretary Lawrence Summers' withdrew as a candidate for Federal Reserve chairman, removing market uncertainty about a long confirmation process that already had plenty of opposition.

The move means a path for the next Fed chief is likely to be easier, and it also has added to expectations that the Fed will continue its current dovish path. Summers was thought to be a bit more likely to remove stimulus more quickly.

Summers' surprise decision on Sunday came two days before the U.S. central bank will meet to decide when and by how much to scale back its bond purchases, or quantitative easing, from the current pace of $85 billion a month.

Investors flocked to housing-related stocks on bets of downward pressure on mortgage rates. The PHLX housing index jumped 2.9 percent. Among individual stocks, D.R. Horton jumped 4.1 percent to $19.89.   Continued...