U.S. Stocks Rebound From Nine-Week Low on Economic Data; U.S. Dollar Rallies Against Euro; New Home Sales Hit Greatest Gain Since 2008
Stocks climbed today, as the S&P 500 rebounded from a nine-week low after data showed durable-good orders and home sales increased more than expected and consumer confidence rose. “People are still digesting the news from the Fed, making mental adjustments for different levels of interest rates and what those might imply for securities’ prices over the next several quarters,” John Carey, a fund manager at Boston-based Pioneer Investment Management Inc., said. “I’m encouraged the market has stabilized a little here.”
The dollar bounced back from earlier losses and overtook the euro and yen today after a wave of economic reports strengthened optimism that the recovery is strong and the Federal Reserve may be able to slow its stimulus. “The dollar has been trading on Fed speculation for the last two weeks,” said John Doyle, currency strategist at Tempus Inc in Washington. “Yesterday, comments from two Fed officials were more dovish than Bernanke but attention has now shifted to durable goods which were good for the ‘tapering sooner’ argument.”
The housing market hit a strong note last month — sales of U.S. single-family homes rose to their highest level in nearly five years, reaffirming a rebound in the market and strength in the industry. Moreover, the Commerce Department stated that Tuesday sales increased 2.1 percent to a seasonally adjusted annual rate of 476,000 units, which is the highest level since July 2008. Economists polled by Reuters expected new home sales to rise to a 462,000-unit rate in May.