Housing reports cheer up U.S. stocks; indexes muted

by Daniel Wagner - Sept. 19, 2012 06:39 PM
Associated Press

A pair of encouraging reports about the housing market boosted U.S. stocks a little Wednesday.

Home sales jumped to the highest level in more than two years in August, the National Association of Realtors said. Sales rose 7.8 percent to a seasonally adjusted annual rate of 4.82 million, the most since May 2010.

Earlier, the government reported that construction of single-family homes in August also was the fastest in more than two years.

Stocks of homebuilders, already up after the construction report, rose sharply after 10 a.m., when the jump in home sales was reported. D.R. Horton Inc. rose 87 cents, or 4.1 percent, to $22.22; Beazer Homes USA Inc. rose 22 cents, or 6.2 percent, to $3.75; and KB Home rose 46 cents, or 3.6 percent, to $13.16.

The gains for broader stock indexes were muted. At its high for the day, the Dow Jones industrial average was up just 62 points.

The housing numbers "are fantastic news," but traders continue to worry about recent discouraging signals this week like downgrades of railroads and a warning from Federal Express that the global economy is slowing, said JJ Kinahan, chief derivatives strategist for TD Ameritrade, a retail brokerage.

"The market is at a bit of a conundrum," Kinahan said. "There are just constantly these mixed signals."

The Dow closed up 13.32 points, or 0.1 percent, at 13,577.96. The Dow is a 4 percent rally shy of its all-time high of 14,164 on Oct. 9, 2007.

The Standard & Poor's 500 index rose 1.73 points, or 0.1 percent, to 1,461.05.

The Nasdaq composite index rose 4.82 points, or 0.2 percent, to 3,182.62.

20 Sep, 2012

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Source: http://www.azcentral.com/business/articles/2012/09/19/20120919housing-reports-cheer-up-us-stocks-indexes-muted.html
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