NEW YORK, July 19 (Xinhua) -- Wall Street rallied Thursday on strong corporation quarterly earnings with the Dow Jones average and S&P 500 index setting new record close.

    The upbeat profit news boosted the market, although Fed Chairman Ben Bernanke warned sub prime losses could reach 100 billion dollars, said analysts.

    Bernanke told Capitol Hill Thursday morning on his second day of semiannual report to the Congress that problems such as foreclosures among holders of subprime mortgages are likely to get worse before they get better.

    Also on Thursday, a report said the U.S. leading economic indicators edged down in June.

    The Conference Board, a economic research group, reported that the composite index of leading economic indicators fell after a downwardly revised 0.2 percent rise in May, and a 0.2 percent decline in April.

    "The coincident economic index continued to rise through June, showing the economy is currently healthy, but the leading index has slowed in recent months, suggesting a possible softening of the overall pace of economic activity later in the second half of this year," said Ken Goldstein, labor economist at the Conference Board.

    "While the economy has weathered the negative impact of the housing slump and the increases in gas and grocery prices, these negative factors continue to hold down growth in consumer and investment activity," he added.

    In corporate news, Bank of America Corporation reported a 5-percent net income rise in the second quarter. Net income reached 5.76 billion dollars from 5.48 billion dollars a year earlier.

    The web search engine giant Google said its earnings jump more than 28 percent in the second quarter due to strong growth on its Internet advertising business.

    Honeywell, a U.S. leading technology and manufacturing firm, announced second quarter sales increased 8 percent to 8.5 billion dollars while earnings were up 24 percent to 78 cent per share versus 63 cents per share last year.

    Shares of IBM surged past a 52-week high to 116.48 dollars as the company's earning rose about 12 percent in the second quarter.

    The Dow Jones industrial average closed above 14,000 milestone for the first time, the blue chip index rose 82.19, or 0.59 percent, to settled at 14,000.41.

    The Dow hit 14,000 for the first time on Tuesday, setting the 31st record high since the beginning of this year.

    The S&P 500, the broader stock indicator, was up 6.91, or 0.45 percent, to 1553.08. The Nasdaq composite index rose 20.55, or 0.76 percent, to 2,720.04.