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Stocks edge higher after jump in home sales

Stocks edge higher after jump in home sales

Reports showing jumps in home sales and factory orders are keeping stocks afloat.
Major stock indicators reversed early losses and edged slightly higher in morning trading Wednesday after the Commerce Department said new home sales rose 9.6 percent in July _ the fourth straight monthly increase. Sales rose to 433,000, the strongest pace since September and well above the 390,000 figure economists expected.
Earlier Wednesday, the Commerce Department said orders for goods expected to last at least three years rose 4.9 percent in July _ the biggest jump in two years and more than the 3 percent increase economists had expected.
The day's news followed upbeat readings on consumer sentiment and home prices on Tuesday that sent stocks to fresh highs for the year.
The market's gains on Wednesday were modest, reflecting the caution that still pervades Wall Street. After a five-month run-up in stocks, with little break, investors are unsure how much further the market can go without seeing actual economic growth.
Matt King, chief investment officer at Bell Investment Advisors said much of the improving economic data has already been factored into stocks.
"We're just moving on momentum more than anything else," he said.
In morning trading, the Dow Jones industrials moved higher for a seventh straight day, rising 13.45, or 0.1 percent, to 9,552.74, after being down as much as 45 points prior to the home sales data.
The Standard & Poor's 500 index rose 1.15, or 0.1 percent, to 1,029.15, and the Nasdaq composite index rose 3.45, or 0.2 percent, to 2,027.68.
Advancing issues were roughly even with decliners on the New York Stock Exchange, where volume came to 315.2 million shares, compared with 394.9 million shares at the same time on Tuesday.
In other trading, the Russell 2000 index of smaller companies rose 1.19, or 0.2 percent, to 584.41.
Shares of homebuilders surged for a second day after the housing data. Hovnanian Enterprises Inc. rose 36 cents, or 7.9 percent, to $4.93, tacking on to its 6.5 percent jump the day before. DR Horton Inc. rose 67 cents, or 5.1 percent, to $13.72.
Retail stocks were mostly higher after a handful of upbeat earnings reports. Shares of Dollar Tree Inc. rose $2.98, or 6.2 percent, to $50.88 after the company posted a 51 percent jump in its second-quarter profit as its deeply discounted goods attracted cash-strapped consumers.
Government bond prices dipped after the positive economic data and ahead of an auction of $39 billion in five-year notes. The yield on the benchmark 10-year Treasury note rose to 3.45 percent from 3.44 percent late Tuesday.
Stocks got a lift Tuesday after improving data on home prices reinforced the notion that the battered industry is stabilizing. The Standard & Poor's/Case-Shiller U.S. National Home Price Index rose 1.4 percent in the second quarter, the first quarterly increase in three years. Traders also welcomed a more upbeat report on consumer sentiment from the Conference Board.


Updated : 2021-03-03 04:58 GMT+08:00