July 30, 2008 > US stocks advance on upbeat economic reports
US stocks advance on upbeat economic reports
By Tim Paradis, AP Business Writer
NEW YORK (AP), Jul 25 _ Upbeat economic data lifted U.S. stocks Friday, placating a market pummeled a day earlier by concerns about housing and the financial sector.
A better than expected report on home sales helped Wall Street shake off some early uncertainty. The Commerce Department said June sales of new single-family homes fell by 0.6 percent to a seasonally adjusted annual rate of 530,000 units; the market expected sales to total 505,000. That report helped offset concerns raised by a weak reading on existing home sales on Thursday.
And there was good news about consumers, whose shyness about spending has troubled Wall Street. The Reuters/University of Michigan index of consumer sentiment for the first part of July came in at 61.2, while economists forecast a reading of 56.4, which was the level hit in June _ a 28-year-low.
The Commerce Department also said orders for durable goods rose 0.8 percent last month, far better than the 0.4 percent decline economists expected. It was the best showing since a 1.1 percent rise in February and reflected strength in demand for heavy machinery, primary metals such as steel and even a slight rebound in the beleaguered auto industry.
Linda Duessel, equity market strategist at Federated Investors, said economic figures such as the durable goods numbers are important because they reveal continued demand from abroad, which could help U.S. companies continue to rake in profits even if the U.S. economy isn't running at full steam.
``That's good news for market participants as we try to find a footing in the market because we really don't want to see our weakness leak outside the U.S.,'' she said.
Meanwhile, a barrel of light sweet crude fell $1.40 to $124.09 on the New York Mercantile Exchange. Oil prices have fallen over $20 in recent weeks, alleviating some of Wall Street's concerns about impact of inflation consumers' ability to spend.
In midday trading, the Dow Jones industrial average rose 37.05, or 0.33 percent, to 11,386.33. The Dow, which fluctuated in early trading, fell more than 280 points Thursday.
Broader stock indicators also rose. The Standard & Poor's 500 index advanced 6.02, or 0.48 percent, to 1,258.56, and the Nasdaq composite index rose 24.08, or 1.06 percent, to 2,304.19.
Bond prices moved lower as investors were expected to shift back into stocks. The yield on the benchmark 10-year Treasury note, which moves opposite its price, rose to 4.09 percent from 4.00 percent from late Thursday.
The dollar was higher against other major currencies, while gold prices rose.
In corporate news, Juniper Networks Inc., the maker of networking equipment, reported a 40 percent increase in earnings for the second quarter, helped by a new product line. Results narrowly surpassed Wall Street projections. The stock rose $3.21, or 14 percent, to $25.78.
Chemicals maker Huntsman Corp. said it was approached by investors offering funding to help complete its $6.5 billion takeover by Apollo Management. Huntsman rose 68 cents, or 5 percent, to $13.95.