The Joplin Globe, Joplin, MO

Business

June 27, 2012

Stocks rise on stronger US housing, factory data

NEW YORK — A rare double shot of good news about the U.S. economy sent stocks strongly higher Tuesday. The Dow Jones industrial average rose 96 points despite lingering fear about Europe’s debt turmoil.

Americans signed more contracts to buy previously occupied homes in May, matching the fastest pace in two years, the National Association of Realtors said. The report reinforced recent signals that the housing market is improving in some areas following a slump of more than six years.

Homebuilders soared. Lennar Corp. had reported earlier that its second-quarter profit rose as deliveries and new orders increased. Its stock jumped $1.80, or 7 percent, to $29.19, the biggest gain in the Standard & Poor’s 500 index.

The ISE Homebuilders index rose 42 cents, or 4 percent, to $10.69. PulteGroup, D.R. Horton and Hovnanian Enterprises all rose sharply.

The government reported before the market opened that businesses placed more orders for long-lasting manufactured goods in May, suggesting they remain confident in the U.S. economy.

Orders for durable goods rose 1.1 percent. Core goods, a measure of business investment plans, jumped 1.6 percent. Both increases followed two months of declines.

The reports are a rare glimpse of good news about the U.S. economy after three months of weak output and abysmal job growth.

The Dow rose 91 points to 12,625 as of 10:30 a.m. EDT.

The S&P 500 rose 11 points to 1,331. Its biggest loser by far was auto parts maker O’Reilly Automotive, which fell $17.60, or 19 percent, to $78.84. O’Reilly said its second-quarter earnings will be at the low end of its earlier estimates and sales will be weaker than previously expected.

The Nasdaq composite average rose 21 points to 2,875.

Markets remain wracked with concern as European leaders prepare for a two-day summit aimed at defusing their lingering debt crisis. German Chancellor Angela Merkel warned Wednesday that there would be no quick solution to the structural issues plaguing the continent.

 

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