Investors nudge rally forward with modest gains

On Tuesday, the National Association of Realtors reported a better-than-expected rise in pending home sales for a fifth straight month in June. However the housing sector has begun to show steady signs of stabilization, and the market has largely factored in improvements there.

Earlier Tuesday, the Commerce Department said consumer spending rose 0.4% in June, slightly more than anticipated and the second straight monthly gain. But the report also showed that personal incomes, an indicator of future spending, dropped by a larger-than-expected 1.3%.

Among the day's earnings news, homebuilder D.R. Horton DHI reported a smaller loss than the same period a year ago, beating Wall Street's estimates, while Toyota posted a smaller-than-expected loss on booming sales of its Prius hybrid. That came a day after U.S. automakers reported better sales for July thanks to the government's wildly successful cash for clunkers program.

On Monday, all major stock indexes rose more than 1% to fresh highs for the year, tacking on to July's big advance that sent the Dow up 725 points. Major indexes are still down 35% from their peak in October 2007.

Bond prices reversed early gains and fell. The yield on the benchmark 10-year Treasury note, a widely used benchmark for mortgages and other kinds of loans, rose to 3.72% from 3.64% late Monday.

The dollar was mixed, while gold prices rose.

Oil prices shed 16 cents to $71.42 a barrel on the New York Mercantile Exchange.

Overseas, Japan's Nikkei stock average rose 0.2%, while Hong Kong's Hang Seng index dipped 0.1%. Britain's FTSE 100 and Germany's DAX index both lost 0.2%, and France's CAC-40 slipped 0.04%.

  • 1
  • |
  • 2
Join the Discussion
blog comments powered by Disqus
You Might Also Like...