Get breaking news alerts via email

Click here to manage your alerts
In this Monday, June 10, 2013 photo, trader Edward Landi check a screen in a booth on the floor of the New York Stock Exchange. Global stock markets traded fitfully Tuesday June 18, 2013 as investors watched for signs of a possible change in U.S. stimulus efforts by the Federal Reserve. (AP Photo/Richard Drew)
Stocks edge higher on home building, low inflation
First Published Jun 18 2013 08:48 am • Last Updated Jun 18 2013 08:48 am

NEW YORK • U.S. stocks were up in early trading Tuesday, boosted by government reports of gains in home construction and low inflation. Expectations that the Federal Reserve will keep in place programs meant to prop up the economy also drove the market higher.

The Dow Jones industrial average was up 75 points, or 0.5 percent, to 15,253 after the first hour of trading.

Join the Discussion
Post a Comment

The Standard & Poor’s 500 index edged up five points, or 0.3 percent, to 1,644. All 10 industry groups in the index rose, led by telecommunications.

The Commerce Department said that the pace of new home building was up in May, helped by more buyers and a scarcity of houses for sale.

The Fed has had an outsized effect on the stock market in recent weeks, with major indexes getting yanked back and forth after Fed Chairman Ben Bernanke said May 22 that the central bank could pull back on its bond-buying program, which is meant to help the economy by driving investors into stocks and keeping interest rates low. Fed policymakers began meeting Tuesday, but it won’t be until Wednesday that they announce their latest policy decisions.

For many investors, Tuesday was just a holding pattern ahead of Wednesday’s Fed news.

"The big wind blowing is what’s coming from the Fed meeting, and right now the wind is not blowing," said Brian Doe, wealth adviser at Gratus Capital in Atlanta. "We have this little calm where everybody can be optimistic."

Despite Tuesday’s report on a pickup in home building, many analysts think Fed leaders will determine that the economy is still weak enough to need Fed stimulus, which has generally made them send stocks higher. That’s largely because the government’s jobs report earlier this month showed that, while the U.S., economy is still adding jobs, it’s not at a rate fast enough to bring down the unemployment level.

The Labor Department reported Tuesday that U.S. consumer prices rose in May, but only slightly. That’s also likely to weigh in on the Fed’s decision making: The Fed knows that its stimulus programs can boost inflation. If inflation is in check, that gives the Fed more leeway to continue the programs.

Stocks were up throughout most of Europe, despite reminders that the economy there is still far from healed. European car sales hit their lowest level for the month of May in 20 years. In Greece, bickering continued over the prime minister’s decision last week to shut down state TV in an effort to try to save money.

story continues below
story continues below

In other U.S. stock trading, the Nasdaq composite index rose 15 points, or 0.4 percent, to 3,467.

Among stocks making big moves:

—Hormel Foods, the maker of Spam and Skippy peanut butter, slipped after the company said it expects lower profits for the year. The stock fell $2.01, or 5 percent, to $38.63.

—Jack in the Box was up after announcing it will close about 20 percent of the Qdoba Mexican Grill restaurants that it owns. Jack in the Box rose 97 cents, or 2.6 percent, to $37.96.

—Signet Jewelers, which runs the Kay Jewelers and Jared brands, rose after announcing that it plans to buy back up to $350 million of its own stock. Signet rose $1.05, or 1.5 percent, to $69.02.

Copyright 2014 The Salt Lake Tribune. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Top Reader Comments Read All Comments Post a Comment
Click here to read all comments   Click here to post a comment

About Reader Comments

Reader comments on sltrib.com are the opinions of the writer, not The Salt Lake Tribune. We will delete comments containing obscenities, personal attacks and inappropriate or offensive remarks. Flagrant or repeat violators will be banned. If you see an objectionable comment, please alert us by clicking the arrow on the upper right side of the comment and selecting "Flag comment as inappropriate". If you've recently registered with Disqus or aren't seeing your comments immediately, you may need to verify your email address. To do so, visit disqus.com/account.
See more about comments here.
Staying Connected
Contests and Promotions
  • Search Obituaries
  • Place an Obituary

  • Search Cars
  • Search Homes
  • Search Jobs
  • Search Marketplace
  • Search Legal Notices

  • Other Services
  • Advertise With Us
  • Subscribe to the Newspaper
  • Access your e-Edition
  • Frequently Asked Questions
  • Contact a newsroom staff member
  • Access the Trib Archives
  • Privacy Policy
  • Missing your paper? Need to place your paper on vacation hold? For this and any other subscription related needs, click here or call 801.204.6100.