Market Wrap: Stocks Rise as Home Construction Rebounds

By STEVE ROTHWELL

NEW YORK -- A summer swoon for the stock market appears to be over for now.

The Standard & Poor's 500 index (^GPSC) closed within six points of its all-time high Tuesday, less than two weeks after slumping on concerns about rising tensions in Iraq and Ukraine.

Investors were encouraged by economic reports that suggested growth may be poised to pick up, while inflation remains subdued. A pair of company earnings reports also hinted that consumers may be getting more confident and spending more.

Home Depot (HD), the nation's la! rgest home improvement retailer, rose after raising its annual profit forecast following a strong spring selling season. TJX (TJX), the parent company of T.J. Maxx, Marshalls and other stores, climbed on strong earnings.

"The economic reports ... have been coming out better than expected," said Robert Pavlik, Chief Market Strategist at Banyan Partners. "There's been a shift in the focus of investors away from some of the geopolitical events."

The Standard & Poor's 500 index gained 9.86 points, or 0.5 percent, to 1,981.60. The index is up 1.4 percent for the week and is approaching its record close of 1,987.98 reached July 24. The Dow Jones industrial average (^DJI) rose 80.85 points, or 0.5 percent, to 16,919.59. The Nasdaq composite (^IXIC) climbed 19.20 points, or 0.4 percent, to 4,527.51.

TJX, the parent company of T.J. Maxx, Marshalls and other stores, was the biggest gainer in the S&P 500 on Tuesday. The company's stock rose $4.66, or 8.6 percent, to $58.56 after it reported that its quarterly income climbed 8 percent as sales strengthened in the U.S. and abroad. The results beat the estimates of Wall Street analysts. TJX also lifted its full-year earnings forecast.

Home Depot jumped $4.64, or 5.6 percent, to $88.23 after the company said its quarterly income surged 14 percent. Spring is the biggest season for home-improvement retailers as homeowners work on! their yards and gardens. Home Depot has also been helped by an improving housing market.

"Home Depot's earnings give you a measure of confidence in housing, to an extent, and a measure of retail confidence," said JJ Kinahan, chief strategist at TD Ameritrade. "Those are two areas where we like to look to see how the consumer is really feeling."

A report that showed inflation remains subdued also gave stocks a lift.

U.S. consumer prices rose in July at the slowest pace in five months, held back by a drop in gasoline prices. Consumer prices edged up 0.1 percent, after larger gains of 0.3 percent in June and 0.4 percent in May. If inflation remains constrained, investors judge that the Federal Reserve will be able keep its key interest rate low for longer.

The Fed is currently winding down its economic stimulus but hasn't yet said when it will start raising interest rates.

Beauty products company Elizabeth Arden (RDEN) was one of the big losers o! n Tuesday.

The company slumped after reporting lower sal! es and a loss that was bigger than analysts' had expected. The company said the decline in sales of celebrity fragrances, particularly the Justin Bieber and Taylor Swift scents, was steeper than had been anticipated. Arden's stock dropped $4.56, or 23 percent, to $15.05.

Benchmark U.S. crude fell $1.93, or 2 percent, to $94.48 a barrel in New York and is now down nearly 4 percent for the month of August as crude supplies remain ample. Bond prices didn't move much. The yield on the 10-year Treasury note was unchanged at 2.40 percent from Tuesday.

In metals trading, gold slipped $2.60 to $1,296.70 an ounce. Silver fell 22 cents to $19.41 an ounce. Copper fell two cents to $3.09 a pound. In currency trading, the dollar rose 0.3 percent to 102.89 yen, while the euro fell 0.3 percent against the U.S. currency to $1.3318.

What to Watch Wednesday:

• The Federal Reserve releases minutes from its July interest rate meeting at 2 p.m. Eastern time.

These major companies are scheduled to release quarterly financial statements:

• American Eagle Outfitters (AEO)
• Eaton Vance (EV)
• Hain Celestial Group (HAIN)
• Hewlett-Packard (HPQ)
• Lowe's (LOW)
• J.M. Smucker (SJM)
• L Brands (LB)
• Madison Square Garden (MSG)
• PetSmart (PETM)
• Staples (SPLS)
• Synopsys (SNPS)
• Target (TGT)

• For many employers, open enrollment season for some benefits happens in October. This usually sneaks up on some people, who scramble to decipher benefits and make elections last minute. Although you won't be able to see the options until the enrollment period opens, take time now to review your benefits. Are you taking advantage of any 401(k) matches? Are your fully funding your Flexible Spending Account? What about employer offered life and disability insurance? (A fun infographic from the Council for Disability Awareness shows your risks). Maximize your benefits and don't leave any money on the table.
  ​1. Make the right choices at open enrollment
• Back-to-school time can be expensive if you're not prepared. Money is spent on clothes, books, supplies and technology -- and that's before the doors to the classroom have even opened. Before hitting the stores, do these two things:

  • Conduct an online search for "coupon code" along with the name of any store you'll be shopping at. Typically you can find some great online deals.
  • Get a list from you class or teacher of specific type of notebook, calculator, etc. required. If you can't get child's "must haves" from ahead of time, buy just the bare minimums until school starts and the list is available.
  2. Spend wisely on back-to-school items
• It's hard to think about the holidays when we're just making it through summer, but now is the time to build up a financial cushion. Set yourself up with an automatic transfer to a separate savings account and participate in the Holiday Fund Money Challenge to build up a savings of $450. How much do you need for the gifts, travel, parties, entertaining, food and other holiday activities you anticipate? Planning will help to ease the stress that comes around the holidays.
  ​3. Plan for the end-of-year holidays
• In lieu of scrambling at the end of the year to make contributions to retirement accounts by Dec. 31, double-check your contributions now and determine if there's room in your cash flow to allow for an increase to possibly max out by year end.
  ​4. Maximize your retirement funding
• Summer is a typically a time of transitions. There are weddings, moves to new homes, possibly a new family addition and more. If summer is the time when these events take place, fall should be the time to take stock of how they're panning out. If you're recently married and haven't already, now is the time to have the money talk with your spouse and make decisions about spending plans, merging (or not merging) accounts, beneficiary updates and more. If you've moved, check out how the new location has affected your cost of living spending in terms of activities, gas costs, groceries and more. Ultimately with any transition, you need to review your spending plan and determine what areas (if any) need to be adjusted.
  5. Consider your transitions
• If you're lucky enough to live in one of the states that actually experiences seasons, fall is the time to prep for energy savings by caulking and weatherstripping doors and windows, turning your thermostat back for a fixed period each day and insulating your attic, basement or outside walls.
  6. Weatherproof your home
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Source : http://www.dailyfinance.com/2014/08/19/market-wrap-stocks-rise-home-construction-rebounds/