Stocks rose on Tuesday, rebounding from a sharp fall in global equities the previous day, as better-than-expected results from retailers, including Home Depot Inc
Quarterly results from the two large retailers were complimented by results from upscale department store operator Saks Inc
U.S. housing starts and permits unexpectedly fell in July, while the inventory of total houses under construction fell to a record low, a government report showed, adding to concerns that the nascent housing market recovery may be slow. Some analysts said, however, that fewer new houses may allow the market to absorb inventory and support prices.
The Dow Jones home construction <.DJUSHB> index rose 1.4 percent.
We are seeing some tentative signs of improvement in the market this morning, following yesterday's losses around the world, said Michael Sheldon, chief market strategist at RDM Financial in Westport, Connecticut.
But he added: Today's housing start data does reinforce the fact that any housing recovery that does take place is likely to be limited in scope, at least over the near term.
The Dow Jones industrial average <.DJI> was up 43.23 points, or 0.47 percent, at 9,178.57. The Standard & Poor's 500 Index <.SPX> was up 4.04 points, or 0.41 percent, at 983.77. The Nasdaq Composite Index <.IXIC> was up 10.14 points, or 0.53 percent, at 1,940.98.
The S&P 500 has rallied almost 50 percent since a closing low in early March and some analysts were quick to call the drop yesterday as the start of a correction, with the S&P falling more than 2 percent for its heaviest decline in seven weeks.
Today's results from retailers were in sharp contrast to those of Lowe's Cos
Home Depot shares rose 3.3 percent to $26.97, Target climbed 7 percent to $44.14, while Saks added 3.4 percent to $5.53. The S&P retail index <.RLX> was up 1.3 percent.
Another key earnings report will come after the market closes. Investors will watch Hewlett-Packard Co
Also in the technology sector, smartphone makers Apple Inc
Apple's shares climbed 1.7 percent to $162.21, RIM added 3.2 percent to $73.00, and Palm climbed 3.6 percent to $13.70.
(Reporting by Edward Krudy; Editing by Padraic Cassidy)