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GLOBAL MARKETS-Housing sector helps stocks advance; dollar dips

Published 24/08/2016, 01:53 am
© Reuters.  GLOBAL MARKETS-Housing sector helps stocks advance; dollar dips
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(Changes dateline to New York; adds U.S. market open, housing stocks; updates throughout)

* Most stock indexes firmer, new U.S. home sales soar

* Oil prices reverse losses on Reuters' report of Iran signals

* NZ$ up as central bank flags just 35 bps of easing

By Hilary Russ

NEW YORK, Aug 23 (Reuters) - World shares crept up on Tuesday with a boost from housing sectors while the dollar lost ground as investors awaited further clues on whether the Federal Reserve will raise U.S. interest rates this year.

Wall Street opened higher for the first time in three days, and the Nasdaq hit a record intraday high, with the overall gain in U.S. stocks led by technology and housing. Materials also rose nearly 1 percent .SPLRCM .

Housing stocks jumped up by at least 1.75 percent .HGX after the Commerce Department reported new U.S. single-family home sales soared unexpectedly to near nine-year highs in July. housing data helped traders fill the gap as markets await an annual gathering of global central bankers and a speech by Fed Chair Janet Yellen on Friday in the mountains of Wyoming.

"The big surprise (at Jackson Hole) would be a hawkish shift from Yellen which would be enough to rock the boat on risk and send U.S. rates and the dollar sharply higher," said Brad Bechtel, managing director at Jefferies in New York.

"But I doubt she wants to do this and would prefer a relatively mixed view that has elements of hawkishness and dovishness and ultimately results in a December tightening, but a dovish December tightening."

The Dow Jones industrial average .DJI rose 43.76 points, or 0.24 percent, to 18,573.18, the S&P 500 .SPX gained 8.34 points, or 0.38 percent, to 2,190.98 and the Nasdaq Composite .IXIC added 25.05 points, or 0.48 percent, to 5,269.65.

The bump in new home sales helped the U.S. dollar trim losses, though the greenback was still down 0.11 percent to 94.42 against a basket of major currencies .DXY .

The euro firmed to $1.1321 EUR= as one major bank decided the news had been good enough that the European Central Bank will not need to cut its interest rates any deeper into negative territory, as it had previously expected. /FRX

European equities rose 1.02 percent .STOXX , led by mining stocks, after data pointed to continuing gradual improvement in the region's economy. .EU Homebuilders there also saw a bounce following a solid update from Persimmon PSN.L . upbeat French PMI figures showed the private sector growing at its fastest in 10 months while in Britain export orders hit a 2-year high to confound Brexit doom-mongering. Zealand's dollar, meanwhile, was up 0.66 percent at $0.7316 NZD=D4 after the country's central bank forecast another 35 basis points in possible rate cuts, less than many investors had wagered on. (U.S.) dollar is weakening ... due to the general anticipation around Jackson Hole on Friday," said Saxo bank's head of FX strategy John Hardy.

"There is also a general reach for yield happening. That was one of the things we saw with (New Zealand central bank governor) Wheeler waving the white flag that he is not going to use easing to try and weaken the currency."

Oil prices jumped as much as 2 percent, reversing earlier losses, after Reuters reported that Iran was sending positive signals that it may support joint OPEC action to prop up the market. crude LCOc1 was up 87 cents, or 1.8 percent, at $50.03 a barrel by 11:02 a.m. EDT (1502 GMT). It had fallen 1.4 percent earlier to $48.48.

U.S. crude CLc1 jumped 70 cents, or 1.4 percent, to $48.11.

In focus later on Tuesday will be the first of this week's reports on U.S. inventories, which analysts expect will show a decline in crude and gasoline stocks. EIA/S

<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ Global assets in 2016

http://reut.rs/1WAiOSC European economic overview

http://link.reuters.com/vyx93w Currencies in 2016

http://link.reuters.com/tak27s Emerging markets in 2016

http://reut.rs/1ZKAaO6 Oil prices

http://link.reuters.com/beb23v

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