By Mark DeCambre and Sara Sjolin, MarketWatch
Best Buy surges 17% after beating Wall Street expectations
The Nasdaq Composite briefly touched an all-time intraday high
on Tuesday as stocks shrugged off a second day in a row of falling
oil futures to march firmly higher amid a rise in global equity
benchmarks.
A reading of the sale of new homes and a better-than-expected
second-quarter report from Toll Brothers Inc.(TOL) helped support
buying appetite.
U.S. new-home sales surged to the highest level in nearly eight
years in July, rising 12.4% to a seasonally adjusted annual rate of
654,000, the Commerce Department said Tuesday.
(http://www.marketwatch.com/story/new-home-sales-roar-to-an-8-year-high-of-654000-in-july-2016-08-23)However
a weaker-than-expected gauge of manufacturing may be tempering
gains.
The Dow Jones Industrial Average , gained 69 points, or 0.4%, to
18,600, supported by a 1.2% rise in shares of Nike Inc. (NKE). The
S&P 500 index advanced 9 points, or 0.4%, at 2,191. All 10
S&P 500 sectors were posting gains, led by a 0.6% climb in
materials shares.
But the Nasdaq Composite Index was enjoying the best run among
the three benchmarks, rising 0.5% to 5,271, and briefly etching out
an all-time intraday high of 5,275.74.
Tuesday's gains follow lackluster action on Monday
(http://www.marketwatch.com/story/dow-futures-tread-water-as-buyers-wont-jump-in-until-yellen-speaks-2016-08-22),
when the mood turned cautious as oil prices tumbled. Hopes faded
that members of the Organization of the Petroleum Exporting
Countries will agree on a production freeze deal next month.
Investors also were playing a waiting game ahead of a retreat of
Federal Reserve members and economists at Jackson Hole, Wyo., on
Friday, where Chairwoman Janet Yellen will be watched for hints
about U.S. monetary policy.
"We could continue to see an element of caution in the markets
in the lead up to this. Investors are still not buying a 2016 rate
hike, even following [Fed Vice Chairman] Stanley Fischer's comments
over the weekend regarding the economy," said Craig Erlam, senior
market analyst at Oanda, in a note. On Sunday, speaking at a
conference sponsored by The Aspen Institute
(http://www.marketwatch.com/story/feds-fischer-we-are-close-to-our-targets-2016-08-21),
Fischer said the central bank is within reach of its twin goals of
inflation of about 2% and healthy employment.
"The only question is whether [Yellen will] strongly hint at a
hike this year or indicate that holding off to early next year may
be warranted, at which point markets would push the hike right back
once again," he added.
Read:Why economists aren't willing to give hawks like Fischer
the benefit of doubt
(http://www.marketwatch.com/story/economists-not-willing-to-give-hawks-like-fischer-benefit-of-doubt-2016-08-22)
The market is pricing in a 15% probability of a rate increase in
September and a 48.1% chance of it happening in December, according
to CME's Fed Watch Too
(http://www.cmegroup.com/trading/interest-rates/countdown-to-fomc.html)l.
Read:Yellen to say 'ready' for another rate hike in Jackson Hole
(http://www.marketwatch.com/story/yellen-to-say-ready-for-another-rate-hike-in-jackson-hole-2016-08-19)
The dollar edged lower against
(http://www.marketwatch.com/story/dollar-slips-as-investors-remain-cautious-ahead-of-jackson-hole-2016-08-23)
all major currencies on Tuesday as investors held off. The ICE
dollar index slipped 0.2% to 94.362.
Economic news: In other economic data, a reading of
manufacturing sentiment was softer in August
(http://www.marketwatch.com/story/markit-flash-us-factory-pmi-softens-in-august-2016-08-23)
after hitting its highest level in nine months in July. The flash
manufacturing purchasing managers index from Markit fell to a
reading of 52.1 this month from 52.9 in July.
See:
There were no Fed speakers scheduled to speak on Tuesday.
Oil blues: Crude-oil prices continued to slide, as Goldman Sachs
said the oil market still looks weak and that prices are likely to
stay in the $45-$50 range through next summer. The investment bank
also said any OPEC production freeze would "likely prove
self-defeating" because it could encourage producers outside the
cartel to ramp up output.
Read:Not even OPEC can save the struggling oil market now,
Goldman says
(http://www.marketwatch.com/story/not-even-opec-can-save-the-struggling-oil-market-now-goldman-says-2016-08-23)
Crude-oil futures lost 0.8% to $47.03 a barrel on Tuesday
(http://www.marketwatch.com/story/oil-prices-slide-further-as-iraq-prepares-to-ramp-up-exports-2016-08-23),
while Brent dropped 0.9% to $48.74 a barrel.
Movers and shakers: Shares of Best Buy Co. Inc.(BBY) surged
nearly 17% after the consumer-electronics retailer posted earnings
ahead of forecasts
(http://www.marketwatch.com/story/best-buys-stock-soars-toward-10-month-high-after-profit-sales-beat-expectations-2016-08-23).
Toll Brothers gained 1.7% as the home builder reported a 58%
rise in third-quarter profit
(http://www.marketwatch.com/story/toll-brothers-profit-matches-views-sales-top-2016-08-23).
Zoe's Kitchen Inc.(ZOES) tumbled 19% after the fast-casual
restaurant chain late Monday cut its guidance for the fiscal year
(http://www.marketwatch.com/story/zoes-kitchen-shares-fall-as-guidance-is-cut-2016-08-22-184854647).
Wells Fargo & Co.(WFC) may also move after the Consumer
Financial Protection Bureau said Monday it fined the bank $3.6
million
(http://www.marketwatch.com/story/cfpb-fines-wells-fargo-36-million-for-deceptive-student-loan-practices-2016-08-22)
for illegal student loan servicing. Shares were up 0.1% in early
trade.
Mobileye NV(MBLY) rose 6.9% and Delphi Automotive PLC(DLPH)
gained 2.6% after news the two are joining forces to develop
self-driving technology
(http://www.marketwatch.com/story/delphi-mobileye-team-up-to-develop-self-driving-tech-for-car-makers-2016-08-23)
for car makers.
Other markets: Asian shares closed mostly higher
(http://www.marketwatch.com/story/little-movement-from-asian-markets-ahead-of-fed-meeting-2016-08-22),
while European stocks rose across the board
(http://www.marketwatch.com/story/european-stocks-step-higher-as-pmi-data-rolls-in-2016-08-23)
after PMI data showed the eurozone recovery picking up pace
(http://www.marketwatch.com/story/eurozone-economic-recovery-picking-up-despite-brexit-pmis-show-2016-08-23).
Metals prices were mostly higher, with gold up $2.00, or 0.2%,
as the dollar, as measured by the U.S. ICE Dollar Index , slipped
0.1%.
(END) Dow Jones Newswires
August 23, 2016 10:41 ET (14:41 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.