On 23 August, 2016 – Most stock indices advance

Positive housing data in the US and flash PMIs in Europe sent stocks higher.
United States
Stocks advanced Tuesday thanks to better than expected housing data in the US and European reports that indicated businesses activity was expanding across the Continent. The Dow Jones industrials were up 0.1 percent, the S&P added 0.2 percent and the Nasdaq was 0.3 percent higher.
New home sales in July climbed at the fastest pace in nearly nine years. Home builders Toll Brothers, PulteGroup and Lennar rallied. Best Buy soared after the retailer reported results that beat estimates. Best Buy said sales in stores open at least a year rose in the latest quarter, a sign that the company’s turnaround strategy was working in the face of strong competition from Amazon and other online retailers. Energy companies Chesapeake Energy and Marathon Oil advanced. Monsanto was higher — it is said to be close to a merger with Bayer AG.
July new home sales surged a monthly 12.4 percent to a 654,000 annualized rate. However, the flash August manufacturing PMI slipped to a below consensus reading of 52.1 from 52.9 in June.
These data reflect observations at 4:00 PM US ET. Gold at the afternoon London fixing was up US$6.10 to US$1,342.00. Copper futures were down 1.3 percent to US$2.12. WTI spot crude was up 55 US cents to US$47.96. Dated Brent spot crude was up 64 US cents to US$49.80. The US dollar was up against the euro, Swiss franc and the Australian dollar. It declined against the yen, pound and Canadian dollar. The Dollar Index was virtually unchanged. The yield on US Treasury 30 year bond was down 1 basis point to 2.23 percent while the yield on the 10 year note was up 1 basis point to 1.55 percent.
Europe
Stocks rebounded Tuesday from Monday’s declines. Investors were encouraged by August flash PMI data, which indicated that the euro area remained on a steady growth path in the third quarter, with no signs of the recovery being derailed by Brexit uncertainty. The FTSE was up 0.6 percent, the CAC gained 0.7 percent, the DAX advanced 0.9 percent and the SMI added 0.5 percent.
Mining stocks along with banks and automakers turned in solid performances. However, energy stocks struggled as crude oil prices continue to retreat. Deutsche Bank and Commerzbank gained. Société Générale, BNP Paribas and Crédit Agricole also finished higher. Volkswagen, BMW and Daimler advanced. In Paris, Schneider Electric climbed on a Bloomberg report that it is weighing a sale of DTN, an agriculture news and data service that could be worth as much as $1.5 billion.
In London, homebuilder Persimmon jumped after reporting a 29 percent gain in first-half profits. Berkeley Group Holdings and Taylor Wimpey also advanced. Tesco increased after data from Kanter Worldpanel showed the grocer’s revenue fell by less than any of its main competitors in the 12 weeks to August 14. BHP Billiton climbed on a broker upgrade. Straumann Holding was higher in Zurich after reporting better-than-expected first-half results and raising its full-year revenue guidance for a second time this year.
Eurozone flash August composite purchasing managers index edged up to 53.3 from 53.2 in July. Germany’s flash composite output index dropped to 54.4 from 55.3 in July. In France, the flash composite climbed to 51.6 from 50.1.
Asia Pacific
Most indices here advanced Tuesday with investors continuing to focus on Fed Chair Janet Yellen’s speech on Friday for policy clues going forward. US crude futures fell nearly 1 percent in Asian deals after tumbling over 3 percent overnight on expectations of increased production, a stronger dollar and a rising US oil rig count.
The Nikkei was down 0.6 percent as the yen firmed up and the flash August manufacturing PMI reading continued to contract. Canon, Panasonic, Nissan Motor, Toyota, Honda Motor and Mazda retreated as the yen inched closer to the 100 level against the US dollar. Renesas Electronics slumped on reports the semiconductor maker is considering acquiring US rival Intersil. Sharp tumbled on news it will implement a large-scale corporate restructuring.
The S&P/ASX was up 0.7 percent and the All Ordinaries added 0.6 percent. The big four banks advanced. Both BHP Billiton and Fortescue Metals Group closed higher. Telecoms provider Vocus Communications rallied after its annual profit more than tripled from last year. Specialty Fashion Group plunged on reporting a full-year net loss. Oil Search retreated after it reported an 89 percent fall in first-half profit.
The Shanghai Composite was up 0.2 percent while Hang Seng was virtually unchanged (up 1.02 point). The Kospi added 0.4 percent after Samsung Electronics rallied to hit a record high on expectations that it would continue to deliver solid earnings in the second half of 2016. The Sensex was virtually unchanged (up 4.67 points).
Looking forward
Germany posts final second quarter gross domestic product. In the US, June FHFA house price index and July existing home sales and weekly EIA petroleum status report will be released.
Global Stock Markets

*Note — all releases are listed in local time.

Source: Fidelity

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