Stocks Lower on Sluggish Housing Sales 07/28 12:01
Major U.S. stock market indexes nudged lower in midday trading on Monday,
weighed down by a report of sluggish sales in the housing market.
NEW YORK (AP) -- Major U.S. stock market indexes nudged lower in midday
trading on Monday, weighed down by a report of sluggish sales in the housing
KEEPING SCORE: As of 12:24 p.m. Eastern time, the Standard & Poor's 500
index was down four points, or 0.2 percent, to 1,973. The Dow Jones industrial
average lost 30 points, 0.2 percent, to 16,930 while the Nasdaq composite
dropped 17 points, or 0.4 percent, to 4,431.
HOUSING: Fewer Americans signed contracts to buy homes in June, as the real
estate market appears to have cooled off this summer. The National Association
of Realtors said that pending home sales index slipped 1.1 percent last month.
A combination of meager wage growth and higher home prices have helped slow
FOR SALE: Family Dollar soared after Dollar Tree announced plans to buy the
rival discount store for roughly $8.5 billion. Family Dollar has responded to
recent struggles by cutting prices, shedding workers and closing stores. Last
month, Carl Icahn, who has built up a stake in the company, urged Family Dollar
to put itself up for sale. In midday trading, Family Dollar's stock shot up
$14.34, or 24 percent, to $75. It rose the most in the S&P 500.
HOUSE SURFING: Trulia jumped on news that Zillow, a rival real-estate
listing service, said it has agreed to buy it for $3.5 billion. Boards of both
companies have already signed off on the deal, but shareholders need to approve
it. Trulia advanced $6.88, or 12 percent, to $63.23. Zillow slumped $3.46, or 2
percent, to $155.40.
EARNINGS PARADE: Wall Street is in the middle of second-quarter earnings
season, when big companies turn in their springtime results and tell investors
how they think the rest of the year will shape up. This week, ExxonMobil and
MasterCard are among the heavyweights posting earnings. American Express and
Merck report Tuesday.
NOT BAD: So far, the news has been much better than many expected. Of the
229 companies that have posted results, nearly seven out of 10 have reported
higher profits than analysts projected, according to S&P Capital IQ. Banks have
been the big surprise.
RUSSIA: Tensions between Western powers and Russia remained a concern for
investors. On Monday, an international court ordered Russia to pay over $50
billion to a group of investors for the expropriation of now-defunct oil
company Yukos. The ruling comes as European countries are considering imposing
sanctions on trade in defense, technology and other goods and restricting
access to European capital markets for Russia's state-owned companies.
STRATEGIST'S VIEW: "I think the market is doing what it should be doing,"
said Robert Pavlik, chief market strategist at Banyan Partners, a wealth
management firm. "It's not getting sucked into all the bad news out there.
Russia is lobbing bombs into Ukraine, and that appears like it could spiral out
of control. The Middle East looks out of control. But the stock market is
trading near an all-time high."
KEY REPORTS: A collection of major U.S. economic data comes out later this
week. On Wednesday, the government's report on second-quarter gross domestic
product is expected to show growth picking up. On Friday, economists forecast
that the monthly jobs report will show employers added between 235,000 and
255,000 workers to their payrolls in July.
EUROPE: In European markets, France's CAC 40 rose 0.3 percent while
Germany's DAX shed 0.5 percent. Britain's FTSE 100 was flat.
CHINA'S STABLE SIGNS: News that profits at China's industrial enterprises
soared 17.9 percent in June over a year earlier suggested that the world's No.
2 economy has stabilized and gave Asian markets a boost. China's benchmark
Shanghai Composite Index surged 2.4 percent.
CURRENCIES, OIL: The euro edged up to $1.3436 from the previous session's
$1.3431. The dollar rose to 101.85 yen from 101.83 yen. The price of benchmark
U.S. crude oil declined 79 cents to $101.30 per barrel.