Stocks Climb After Home Sales Top Expectations
March 23rd, 2010 at 10:58 am Posted by
Original article
Stocks advance after sales of existing homes fall less than expected; sales fall for 3rd month
Stocks are higher after sales of existing homes fell less than expected in February.
The report Tuesday from the National Association of Realtors has topped forecasts but is still raising concerns about the strength of the housing market. Sales have fallen for three months.
The Realtors say sales of previously occupied homes fell 0.6 percent last month to a seasonally adjusted annual rate of 5.02 million. Analysts expected sales would fall 1 percent to 5 million units, according to Thomson Reuters.
The Dow Jones industrial average is up 36 at 10,822. It was up about 7 ahead of the report. The Standard & Poor’s 500 index is up less than 1 at 1,166. The Nasdaq composite index is up less than 1 at 2,396.
THIS IS A BREAKING NEWS UPDATE. Check back soon for further information. AP’s earlier story is below.
NEW YORK (AP) — Stocks rose modestly in early trading Tuesday, continuing a recent trend of slow, steady gains.
A report on sales of previously owned homes due out at 10 a.m. EDT will be the latest report investors turn to for clues about the battered housing market. Housing reports have been among the few exceptions to a recent trend of data showing economic improvement.
Stocks have been climbing steadily in recent weeks following a stream of economic reports that mostly show the economy is recovering, albeit slowly. The Dow Jones industrial average has risen in 14 of the past 17 sessions.
Unlike the manufacturing and industrial sectors, the housing market has been slow to recover after its collapse helped push the nation into recession. Reports on sales, home prices and foreclosure rates have been uneven in recent months.
The National Association of Realtors is expected to say sales of existing homes fell 1 percent in February to a seasonally adjusted annual rate of 5 million units, according to economists polled by Thomson Reuters.
Bad weather across the country and still tight lending and high unemployment were likely the reason sales dipped to their lowest level since last summer.
KB Home said its losses narrowed during its fiscal first quarter, a sign of some stabilization in the market. However, the homebuilder’s results still fell short of expectations.
Treasury Secretary Timothy Geithner is scheduled to testify before Congress about government efforts to overhaul mortgage financiers Fannie Mae and Freddie Mac. The pair, which were essentially taken over by the government during the credit crisis, guarantee a majority of mortgages. The government’s support for the two has helped keep interest rates low as part of an effort to help the housing market recover.
In early morning trading, the Dow Jones industrial average rose 18.44, or 0.2 percent, at 10,804.33. The Standard & Poor’s 500 index rose 0.83, or 0.1 percent, to 1,166.64, while the Nasdaq composite index rose 1.41, or 0.1 percent, to 2,396.81.
The Dow is at its highest level since October 2008.
The recent gains have not come in big chunks like they did last year when triple-digit advances were frequent as the market rose from a 12-year bottom. Instead gains have come in smaller pieces. The Dow rose 44 points Monday.
Stocks rallied Monday after House lawmakers approved a health care overhaul bill that will require about 32 million Americans to get health insurance. Drug and hospital companies got a big boost after the House bill passed because it removed uncertainty that had dogged the sector for months.
