GLOBAL MARKETS-Housing sector lifts U.S., European stocks; oil pares gains

  • Reuters
  • Stock Market News
GLOBAL MARKETS-Housing sector lifts U.S., European stocks; oil pares gains
Credit: © Reuters.

(Updates with U.S. market close, changes to post-stettlement oil prices)

* Most stock indexes firmer; new U.S. home sales soar

* Oil prices pare gains but remain higher

* NZ$ up as central bank flags just 35 bps of easing

By Hilary Russ

NEW YORK, Aug 23 (Reuters) - Homebuilders provided a modest lift to both U.S. and European stock markets on Tuesday, while oil prices got a brief boost from Iran's positive signals on an output freeze.

On Wall Street, technology companies led the Nasdaq to a record intraday high and robust housing market data strengthened the case for a firming economy. stocks jumped 2 percent .HGX after the Commerce Department reported new U.S. single-family home sales soared unexpectedly in July to near nine-year highs. equities rose 0.9 percent .STOXX , led by mining stocks, after data pointed to continuing gradual improvement in the region's economy. of the region's homebuilders also gained following a solid update from UK homebuilder Persimmon PSN.L , which closed 4.2 percent higher and was the biggest riser on the blue-chip FTSE 100 .FTSE . The index closed at its highest level since the UK voted to leave the European Union. housing data helped traders fill the gap as markets await further clues on whether the Federal Reserve will raise U.S. interest rates this year. Global central bankers gather in the mountains of Wyoming later this week and investors are focused on a speech by Fed Chair Janet Yellen on Friday.

"If we continue to keep getting strong economic data it will become hard for the Fed to rationalize not hiking rates," said Erik Wytenus, global investment specialist at J.P. Morgan Private Bank in Palm Beach Florida.

The Dow Jones industrial average .DJI rose 17.88 points, or 0.1 percent, to 18,547.3, the S&P 500 .SPX gained 4.26 points, or 0.2 percent, to 2,186.9 and the Nasdaq Composite .IXIC added 15.48 points, or 0.3 percent, to 5,260.08.

Big gains in oil prices, which had jumped as much as 2 percent on signals from Iran, were squeezed in post-settlement trading after data showed a surprise build-up in U.S. crude stocks. American Petroleum Institute reported that crude inventories rose by 4.5 million barrels in the week to Aug. 19, to 524.2 million. Analysts had expected a decrease of 455,000 barrels. EIA/S

After settling much higher, brent crude LCOc1 was still trading up about 37 cents, or 0.8 percent, at $49.53 per barrel, while U.S. West Texas Intermediate crude CLc1 was up 69 cents, or 1.5 percent, at $48.10.

The bump in new home sales helped the U.S. dollar trim losses. But having hit a five-day high of 94.958 against a currency basket .DXY on Monday, the greenback was flat at 94.533 late in the day. Zealand's dollar, meanwhile, rose 0.47 percent to $0.7302 NZD=D4 after the country's central bank forecast another 35 basis points in possible rate cuts, less than many investors had wagered on. (U.S.) dollar is weakening... due to the general anticipation around Jackson Hole on Friday," said Saxo bank's head of FX strategy John Hardy.

"There is also a general reach for yield happening. That was one of the things we saw with (New Zealand central bank Governor Graeme) Wheeler waving the white flag that he is not going to use easing to try and weaken the currency."

<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ Global assets in 2016

http://reut.rs/1WAiOSC European economic overview

http://link.reuters.com/vyx93w Currencies in 2016

http://link.reuters.com/tak27s Emerging markets in 2016

http://reut.rs/1ZKAaO6 Oil prices

http://link.reuters.com/beb23v

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