Stocks are rallying for a second straight day, as investors took comfort in the Federal Reserve chairman's testimony before Congress and a handful of upbeat economic reports released this morning. With roughly an hour remaining in the trading session, the Dow Jones Industrial Average (DJINDICES:^DJI) is up an impressive 171 points, or 1.2%.

Good economic news all around
In his second day of Congressional testimony, Fed Chairman Ben Bernanke expressed strong support for the central bank's massive and ongoing bond-purchasing program. Responding to concerns that low interest rates are hurting retirees and savers, the Fed Chairman noted that these groups would be hurt more if the economy failed to improve.

"You're not going to get strong returns in an economy that is fundamentally weak," Bernanke noted. "By keeping rates low now, we can help the economy get stronger, we can create more jobs, we can create more momentum in the economy -- that is the way to get a sustainable higher set of interest rates."

Following the release of the minutes from the Fed's last monetary-policy meeting, many investors and analysts were concerned about the central bank's commitment to continue buying upwards of $85 billion in long-term Treasuries and agency mortgage-backed securities per month. On the day the minutes were released, the Dow plummeted by more than 100 points. At the time, it was the biggest single-day drop in three months.

This trend finally reversed itself in earnest yesterday with Bernanke's first round of testimony. As an analyst observed to Reuters, "By and large you can track the turn in the market yesterday and today with Bernanke."

In addition to Bernanke's testimony, stocks were also spurred on by more positive news out of the housing sector. The National Association of Realtors said today that its pending-home-sales index rose 4.5% in January to the highest level since April of 2010, when it spiked prior to the expiration of tax credits designed to stimulate housing demand. Economists surveyed by Reuters had forecast a much more modest 1.5% gain.

According to NAR's chief economist, Lawrence Yun:

Favorable affordability conditions and job growth have unleashed a pent-up demand. Most areas are drawing down housing inventory, which has shifted the supply/demand balance to sellers in much of the country. It's also why we're experiencing the strongest price growth in more than seven years.

Finally, the Department of Commerce reported today that orders for durable goods in January fell by 5.2% compared to December. While this at first seems ominous, the majority of the drop stemmed from a nearly 70% decline in defense spending and a 34% drop in demand for civilian aircraft "as part of a routine order slowdown," according to The Wall Street Journal.

Conversely, orders for nondefense durable goods, a key measure of private-sector business activity, rose by 6.3%. As an economist told the Journal:

The volatile defense capital goods and civilian aircraft categories heavily skewed the overall result. It is much more important to look at the underlying detail of this report rather than the headline change. In January, the underlying detail in the report was robust.

The Dow's best-performing stocks
On the heels of the private-sector durable-goods figures, it's no surprise to see shares of both Boeing (NYSE:BA) and Caterpillar (NYSE:CAT) among the best-performing components of the Dow this afternoon, as both manufacture products that are classified as durable goods. Both companies have struggled this year as investors remain concerned about the domestic and international economic situation. However, they're making up good ground today, up 2.3% and 2.4%, respectively.

JPMorgan Chase (NYSE:JPM) is nevertheless the best-performing stock on the Dow today, up more than 3.4% in afternoon trading. In a presentation to investors yesterday, the bank outlined its plan to cut 4,000 positions this year to further reduce its expenses. The lion's share of the cuts will be in its consumer banking division, as JPMorgan plans to add positions to the commercial-banking side. While the bank's stock originally fell on the news, it's rallying considerably now.

John Maxfield has no position in any stocks mentioned. The Motley Fool owns shares of JPMorgan Chase & Co. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.