Sharechat Logo

While you were sleeping US housing, Tiffany sparkle

Wednesday 27th November 2013

Text too small?

Wall Street gained as better-than-expected American housing data helped bolster shares of homebuilders while an upgraded profit outlook lifted shares of Tiffany.

In afternoon trading in New York, the Dow Jones Industrial Average added 0.16 percent, while the Standard & Poor's 500 Index rose 0.19 percent, and the Nasdaq Composite Index gained 0.56 percent.

After disappointing pending home sales data released yesterday, today's report painted a brighter picture for the industry. Building permits climbed 6.2 percent in October to an annual rate of 1.03 million units, according to the Commerce Department.

It was the highest level since June 2008 and surpassed economists' forecasts.

Separately, the S&P/Case Shiller composite index of home prices in 20 metropolitan areas posted its highest increase since February 2006, soaring 13.3 percent in September from a year ago.

These signs of strength in the real estate industry will also be noted by the monetary policy makers.

"The jump in building permits means that another obstacle to tapering is now removed," Harm Bandholz, chief US economist at UniCredit Research in New York, told Reuters. "The weakness in housing starts and new home sales were probably one important reason-besides the slowdown in payroll gains-why the Fed did not taper in September."

Even so, the US consumer is feeling less upbeat. Consumer confidence sank to the lowest level in seven months, as the Conference Board's reading unexpectedly dropped to 70.4 in November, from 72.4 in October.

Another report, from the Federal Reserve Bank of Richmond, showed the overall business activity index for mid-Atlantic region factories increased to 13 this month.

Gains in shares of Walt Disney, last up 1.8 percent, and Home Depot, last up 1.2 percent, propelled the Dow higher. Shares of Intel and Exxon Mobil were the biggest losers in the Dow, declining 0.9 percent and 0.6 percent respectively.

Shares of Tiffany jumped, last up 8.6 percent, after the company posted third-quarter profit that exceeded analysts' expectations, and it lifted its annual earnings forecast.

"Worldwide sales growth in the quarter demonstrated the growing power of the Tiffany & Co brand and the benefits of our expanding global presence," Tiffany Chairman and CEO Michael Kowalski said in a statement.

"Operating earnings rose faster than sales, reflecting favourable product cost trends and ongoing well-controlled expenses. We're experiencing excellent customer response to our expanded fashion jewelry designs, highlighted by the ATLAS collection, as well as continued growth in our fine and statement jewelry, with particular strength in our yellow diamond collection," Kowalski said.

In Europe, the Stoxx 600 Index ended the session with a 0.6 percent slide from the previous close, as did France's CAC 40. The UK's FTSE 100 Index sank 0.9 percent, while Germany's DAX slipped 0.1 percent.

  General Finance Advertising    

Comments from our readers

No comments yet

Add your comment:
Your name:
Your email:
Not displayed to the public
Comments to Sharechat go through an approval process. Comments which are defamatory, abusive or in some way deemed inappropriate will not be approved. It is allowable to use some form of non-de-plume for your name, however we recommend real email addresses are used. Comments from free email addresses such as Gmail, Yahoo, Hotmail, etc may not be approved.

Related News:

MARKET CLOSE: NZ shares edge lower; power companies under pressure
NZ dollar rises as bets on another OCR cut fade
Broad-based manufacturing pick-up offers silver lining
Global economic outlook not as dark as in August: RBNZ
NZ dollar slips on slew of weak global data, lack of US-China progress
MARKET CLOSE: NZ shares recover as investors re-think RBNZ review
NZ dollar falls on weak Aussie jobs numbers, poor China data
Govt media plan won't weaken commercial players - TVNZ
Goodman trust's 1H net profit quadruples on unrealised property gains
Regional house price inflation accelerates in October

IRG See IRG research reports