Us Markets Advance On Housing Starts
US stocks are advancing this morning, after the Nasdaq Composite Index climbed to a 14-year high yesterday, and as retailers rallied on better-than-projected earnings while data showed inflation pressures remain limited and housing starts jumped.
By Paolo Palazzi-Xirinachs
Tuesday, August 19, 2014 - 00:00
All in all it’s been a good 24 hours of economic news. This morning the S&P 500 has advanced 0.3 % to 1,977.94 as of 10:30 AM in New York, bringing it within 0.5% of its all-time high. The Nasdaq Composite has added 0.3%, and the Dow Jones has increased 55.71 points, or 0.3%, to 16,894.45.
The Fed will release the minutes of its latest gathering tomorrow, before central bankers meet in Jackson Hole, Wyoming. Fed Chair Janet Yellen and European Central Bank President Mario Draghi will be amongst the speakers at the annual symposium on monetary policy. The Fed is watching economic data to help gauge adjustments to monetary stimulus. Yellen has said officials will keep its benchmark interest rate low for a “considerable time” after it ends its bond-buying program – which has been the party line all year.
In date released this morning housing starts surged in July to their highest level in eight months, underscoring the recent pickup in builder optimism as the US residential real-estate market gains some traction. An S&P index of homebuilders gained 1.8%, after jumping 2.1% yesterday as a report showed industry confidence rose in August. D.R. Horton Inc. advanced 2.1% and KB Home increased 2%.
TJX increased 6.6% to $57.47. The discount apparel company that owns T.J. Maxx and Marshalls raised its profit forecast after comparable-store sales grew faster than estimated. Dick’s Sporting Good added 5.1% to $45.73. The company beat second-quarter earnings projections, though it said promotions and advertising will weigh on profit in the rest of the year. The results, together with the rosy outlook from Home Depot, have seemingly fueled investor optimism after a series of disappointing retail earnings reports. Wal-Mart Stores Inc., the world’s largest retailer, posted stagnant US same-store sales last week, marking the sixth straight period of no growth. That followed a report from the Commerce Department that retail sales were little changed in July, hampered by a lack of wage gains.
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