Winners & Losers: Bernanke Juices ... Retail?

There may not be an immediate connection, but retail shares followed the upward trend of the market, as investors breathed a sigh of relief over Federal Reserve Chairman Ben Bernanke's testimony on the Fed's role in Bank of America's(BAC) takeover of Merrill Lynch.

The S&P Retail Index gained 3.5% to 322.29, led by Dress Barn(DBRN), Tween Brands(TWB), Bed Bath & Beyond(BBY) and J.C. Penney(JCP), the day's clear winners.

Dress Barn announced that it would acquire Tween Brands for $157 million in stock.

The news was a positive for both Dress Barn and Tween Brands. Dress Barn saw shares jump 9% to $14.38 in afternoon trading, while Tween Brands skyrocketed 28% to $6.63.

For Dress Barn, the tween-apparel retailer is an opportunity to diversify, while Tween Brands' debt will be paid by Dress Barn and shareholders will receive a 20% premium out of the deal.

Bed Bath & Beyond rose 10.5% to $31.35 in afternoon trading, a day after the home-furnishing retailer posted an unexpected profit in the first quarter.

During the quarter, the company earned $87.2 million, or 34 cents a share, up 13% from $76.8 million, or 30 cents, in the year prior, helped by cost cuts. Analysts expected earnings of 25 cents.