Oil Advance Lifts U.S. Stocks; New Home Sales Up 7.3%

Bikram Pandey
24 May, 2011
New York City

U.S. indexes advanced on the rise in energy and commodities prices. U.S. new home sales increased 7.3% in April but plunged 23.1% from a year ago. Markets in Europe rebounded and in Asia closed mixed.

[R]10:30 AM New York – U.S. indexes advanced on the rise in energy and commodities prices. U.S. new home sales increased 7.3% in April but plunged 23.1% from a year ago. Markets in Europe rebounded and in Asia closed mixed.[/R]

U.S. market indexes rebounded after sentiment improved and prices of crude oil, precious metals and commodities rebounded.

U.S. new home sales in April increased 7.3% to adjusted annual rate of 323,000 from revised March sales of 301,000. Sales declined 23.1% form a year ago. The supply of new homes sales declined 2.8% to 175,000 and inventory of unsold homes declined to 6.5 months in April from 7.2 months in March.

Median home sale price increased 4.6% to 217,900.

Speculations from brokers contributed to market momentum and crude oil advanced $1.78 a barrel to $99.48 and gold price increased $11 to $1,527.10 a troy ounce.

The popular indexes advanced led by the increase in energy complex stocks The Dow gained 0.3%, the Nasdaq increased 0.25% and the S&P 500 index inched up 0.2%. Chevron, Exxon Mobil, BP, Royal Dutch Shell and Marathon Oil led the gainers in the sector.

In Europe, Germany left its estimate of first quarter economic growth at 1.5% matching its first estimate and the business climate index tracked by Ifo was flat in May at 114.2 matching the level in April.

Industrial new orders for EU17 area decreased 1.8% in March, after rising 0.5% in February and for the wider region of EU27 new orders fell 1.9% in March following an increase of 1.0% in February.

Spain completed the sale of 2.3 billion euros of 3- and 6-month treasury bills. The demand at the auction was healthy despite the recent losses suffered by the ruling party in local elections.

Stock Movers

AK Steel Holding Corp ((AKS)) increased 2% after the steel maker proposed to increase steel prices for all flat-rolled carbon steel products by at least $50 a ton and the company blamed higher material costs.

AutoZone Inc ((AZO)) gained 4% after the auto parts retailer reported third quarter earnings of $5.29 a share ahead of consensus estimates tracked by 123jump.com of $5.01 a share.

DSW Inc ((DSW)) soared 10% after the discount shoe retailer reported fiscal 2012 annual net of as much as $2.80 a share.

GT Solar International Inc ((SOLR)) surged 11% after the solar panel chip module maker lifted revenues estimate and raised 2012 earnings outlook to at least $1.55 a share.

Medtronic Inc ((MDT)) declined 2% after the medical devices maker reported adjusted profit of 90 cents a share on weak unit sales and one time costs related to layoffs.