MARKET SNAPSHOT: Stocks Gain After Strong Housing Data; Apple Eyes $100

By Victor Reklaitis and William Watts, MarketWatch

NEW YORK (MarketWatch) -- U.S. stocks advanced Tuesday after a better-than-expected jump in July housing starts and upbeat earnings reports.

Home Depot Inc. (HD) was the biggest gainer in the Dow Jones Industrial Average after the retailer's quarterly results topped forecasts, and Apple Inc. (AAPL) moved up to levels last seen in September 2012.

The S&P 500(SPX) climbed 7 points, or 0.4%, to 1,979, while the Dow industrials(DJI) rose 68 points, or 0.4%, to 16,906. The S&P 500 is nearing its July 24 record close of 1,987.98.

The Nasdaq Composite (RIXF) advanced 9 points, or 0.2%, to 4,517 after the tech-laden index on Monday scored its highest close since March 31, 2000.

The Commerce Department on Tuesday said construction on U.S. new homes rose 15.7% in July to an annual rate of 1.09 million versus 973,000 in June. Economists surveyed by MarketWatch had penciled in July starts of 975,000. The decline in new construction in June also was revised to a much smaller drop.

"I think investors will be encouraged to an extent by the revisions in the data," said Andrew Wilkinson, chief market analyst at Interactive Brokers. He also said geopolitical concerns seem to be receding, even though there's no resolution in the Ukraine-Russia conflict, and that "just gives added impetus to the bulls."

In other economic news, the Labor Department said U.S. consumer prices rose 0.1% in July, matching forecasts.

Wouter Sturkenboom, strategist at Russell Investments in London, said he is modestly positive on markets. "Yesterday was probably a reaction to the unwarranted volatility on Friday, but the rest of the week is going to be about the FOMC (Federal Open Market Committee) minutes and Jackson Hole conference," he said in emailed comments.

Also Tuesday's Need to Know: Why Nasdaq's revisit of March 2000 is the saddest party ever

"On both counts, we and the market expect the prevailing dovish stance to hold, providing upside momentum for markets," Sturkenboom added, but said owing to valuation concerns, his firm remains neutral on U.S. stocks. Valuation worries have been a persistent theme among some market observers, with Yale Professor Robert Shiller weighing in over the weekend.

This week will see the release of the Fed minutes, due Wednesday, and a speech from Federal Reserve Chairwoman Janet Yellen in Jackson Hole, Wyo., on Friday.

Home Depot among stocks to watch

Home Depot shares rose 5% to $87.73, and shares of Medtronic Inc.(MDT) rose 0.1% after the medical devices maker's profit also topped expectations. (Read more on the day's notable movers here: http://www.marketwatch.com/story/home-depot-dicks-sporting-goods-medtronic-report-earnings-tuesday-2014-08-19.)

Apple shares rose 0.6%, moving within a few cents of the $100 mark. The tech giant executed a 7-for-1 stock split in June.

In overseas markets, Japanese stocks rose for a seventh day, boosted by Wall Street gains from Monday. European stocks pushed higher, helped by a leap by Danish shipping and oil conglomerate A.P. Møller-Maersk AS . Oil (CLU4) and gold (GCZ4) dipped.

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