Stocks advance after mixed economic reports
NEW YORK -- The stock market's third quarter started on a positive note after some reassuring data on manufacturing and the housing market.
Stocks gained following a report showing more stable manufacturing activity in the United States. Investors also cheered a fourth straight monthly rise in pending home sales in May. The National Association of Realtors said its seasonally adjusted index of pending home sales edged up to 90.7 in May from 90.6 in April. European markets had risen earlier following similarly upbeat data on manufacturing in that region.
At the close of trading Wednesday, the Dow Jones industrial average was up 57.06, or 0.68%, to 8,504.06. In the broad market, the Standard & Poor's 500 index rose 4.01, or 0.44%, 923.33, and the Nasdaq composite index rose 10.68, or 0.58%, 1,845.72.
Some of Wednesday's bounce, though, may simply be due to stocks appearing cheaper following a big sell-off Tuesday and as investors look to put money to work as the new quarter begins.
Stocks had dropped Tuesday on a disappointing drop in consumer confidence but still ended the second quarter with significant gains, giving the S&P 500 index its best quarter in a decade.
"Some of the buying that wasn't done yesterday is being done today," said Richard Cripps, chief market strategist for Stifel Nicolaus. "I'm a little surprised. There isn't a lot of convincing volume here to read too much into this."
Not all the new economic data was upbeat. Construction spending fell in May by more than the market expected, and the private sector lost more jobs in June than expected. The most eagerly awaited report of the week will come on Thursday, when the Labor Department releases its June jobs report.
Scott Fullman, director of derivatives investment strategy for WJB Capital Group, said the employment report — along with thin, pre-holiday trading volumes — could make for a volatile market Thursday. U.S. markets are closed Friday in observance of the Independence Day holiday.
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