Stocks Catch Bounce on Home Price Data
NEW YORK (TheStreet) -- U.S. stocks finished with mild gains on Tuesday as investors let improved home price data deflect their attention away from the eurozone debt crisis.
The Dow Jones Industrial Average rose 32 points, or 0.26%, to close at 12,535. The blue-chip index ranged from 12,576 to 12,452 on the day.
Shares of JPMorgan got a 1.2% lift after Goldman Sachs added the bank to its America's conviction buy list, while removing and downgrading Morgan Stanley(MS) , whose stock was up incrementally.
Consumer non-cyclicals, energy, financials and services were the strongest sectors in the broad market.
The Case-Shiller 20-city home-price index showed that home prices fell by 1.9% in April from a year ago. While still negative, this is an improvement over the 2.6% decline the month before. Economists, on average, thought the index would fall 2.5% from a year ago. Home prices on average increased 1.3% in April, month over month, for the 20-city composite after seven straight months of declines.
This supports the view of Michelle Meyer, senior U.S. economist at Bank of America Merrill Lynch, that national home prices bottomed at the beginning of the year. "However, we do not expect a sustained upturn in prices from here," she said. "Rather, we expect prices to weaken again at the end of the year, as the economy slows and distressed inventory picks up."