NEW YORK (Reuters) - Wall Street got a lift from the U.S. housing sector and extended a global stock markets rally on Tuesday as investors shifted focus from political crises to expectations monetary policy will remain accommodative.
The dollar climbed smartly as the euro sank to a nine-month low against the greenback. U.S. Treasuries yields rose.
Bolstered by strong profits from home-improvement retailer Home Depot, as well as U.S. housing and economic data, Wall Street gained as equities worldwide neared multi-year highs after the past month’s jitters over conflicts in Ukraine, Iraq and Gaza.
The Dow Jones industrial average rose 80.85 points, or 0.48 percent, to 16,919.59, the S&P 500 gained 9.86 points, or 0.5 percent, to 1,981.6 and the Nasdaq Composite added 19.20 points, or 0.43 percent, to 4,527.51.
“The market has enjoyed a retreat from geopolitical tensions, and we’re seeing sectors that we were concerned about lagging, like housing and consumer discretionary, gaining, which is positive,” said Quincy Krosby, market strategist at Prudential Financial in Newark, New Jersey.
Apple Inc hit $100 for the first time since its seven-for-one stock split in June, giving the iPhone maker a market capitalization over $600 billion. It ended at $100.53 for the day, up $1.37.
The MSCI All Country Index was up 0.46 percent at 428.37.
The FTSEurofirst 300 index of top European shares ended up 0.57 percent, led by gains in Germany, where the blue-chip DAX index was up just under 1 percent.
Traders were encouraged by economic news while on alert for central banker comments for indications of interest rate moves after years of rock-bottom benchmark borrowing rates.
The dollar rallied, benefiting from U.S. economic data and the euro zone’s current account surplus in June. The euro dipped to a nine-month low of $1.3314. The U.S. dollar index rose 0.37 percent to a high last seen nearly a year ago.
U.S. housing starts rebounded strongly in July, pointing to economic momentum. Groundbreaking surged 15.7 percent last month to a seasonally adjusted 1.09 million annual unit pace, after two straight months of declines.
Separately, the Labor Department said its U.S. Consumer Price Index edged up 0.1 percent last month as declining energy costs partially offset increases in food and rents. The CPI had increased 0.3 percent in June.
The benign inflation data gave Treasuries prices a fleeting boost. Benchmark 10-year Treasuries fell 4/32 of a point in price to yield of 2.40 percent.
The 30-year bond dropped 10/32 of a point in price, pushing the yield up to 3.21 percent.
U.S. crude oil and Brent crude futures dropped after giving up early gains as recovering Libyan output, sustained Iraqi production and weak demand offset concerns about threats to supply. Brent touched 14-month lows at $101.17, but traded late off just 4 cents at $101.56. U.S. crude finished at $94.48, down 2 percent.
Investors looked ahead to Wednesday, when the Federal Reserve releases minutes from the July 29-30 Fed policymaking meeting, as well as Fed Chair Janet Yellen’s speech on Friday at a gathering of central bankers in Jackson Hole, Wyoming.
“In the minutes, people will be looking for an exit strategy, but given data we have had, no one is expecting it to come sooner than previously expected. Fed futures are looking to September 2015 and expectations in the market come around that time frame, which is late 2015,” said Thomas Simons, money market economist at Jefferies LLC in New York.
Reporting by Michael Connor; additional reporting by Daniel Bases, Sam Forgione and Chuck Mikolajczak in New York; Editing by Dan Grebler