Strong June seen for auto sales; Chrysler up 8 pct

Tuesday, July 2nd, 2013 | Finance News

DETROIT (AP) — Sales from the major automakers are expected to show that confident U.S. buyers snapped up new cars and trucks at a strong pace in June.

Chrysler said Tuesday that its sales rose 8 percent for its best June since 2007. Ram brand sales rose 23 percent and Dodge sales were up 12 percent on the strength of the Dodge Dart small car.

Other car companies report June results later in the day.

Analysts don't see much that could slow the sales momentum of the first six months.

The things that juiced sales — low interest rates, wider credit availability, rising home construction and hot new vehicles — aren't going away anytime soon. And so far, hiccups in the stock market, higher taxes and fluctuating gas prices haven't dampened demand.


Stock futures higher as positive momentum persists

Tuesday, July 2nd, 2013 | Finance News

By Ryan Vlastelica

NEW YORK (Reuters) - Stock index futures rose modestly on Tuesday, indicating positive market momentum would persist as investors remain optimistic about the economic outlook.

Sentiment has improved since Federal Reserve officials reassured investors that the central bank's bond-buying stimulus policy wasn't ending imminently. However, the S&P 500 remains more than 3 percent below its record closing high.

"We're seeing a retracement of a sell-off that was based in fear, though the market will likely continue to be emotional," said Oliver Pursche, president of Gary Goldberg Financial Services in Suffern, New York.

William Dudley, the president of the New York Fed, will speak at 12:30 p.m. about national economic conditions. His comments will be closely scrutinized for clues about when the Fed might begin to scale back its quantitative easing.

May factory orders will be released at 10 a.m. by the government, and economists polled by Reuters expect a rise of 2 percent, twice the rate of the previous month.

Data on the Institute for Supply Management's New York regional business activity is also on tap for Tuesday, leading up to Friday's closely watched June payrolls report.

Wall Street has had a divided attitude toward U.S. data, as bullish reports sparked declines on concerns any sign of a strong economy will cause the Fed to move up the tapering its bond-buying program.

"Today's move will likely come down to whether we see a strong reaction to the data," Pursche said. "We'll likely be very unpredictable ahead of the payrolls report."

S&P 500 futures rose 4.5 points and were above fair value, a formula that evaluates pricing by taking into account interest rates, dividends and time to expiration on the contract. Dow Jones industrial average futures added 26 points, and Nasdaq 100 futures were up 8.25 points.

Equities surged in the first half of the year, hitting a series of record highs before pulling back dramatically in June on concerns the Fed would begin reining in its stimulus, which helped fuel 2013's gains.

While stocks closed higher on Monday on strong manufacturing and construction data, they ended well off their highs of the session. The S&P lost more than half of its gains, a sign of investor caution. More volatility is expected as the economy eventually moves to a no-stimulus environment.

In corporate news, alcoholic beverage company Constellation Brands Inc fell 4 percent to $51.04 in premarket trading after the company reported first-quarter revenue that was below expectations.

Sources said Pfizer Inc and Novartis AG may make preliminary bids for Onyx Pharmaceuticals Inc . On Sunday, Onyx turned down a roughly $10 billion offer from Amgen Inc .

Zynga Inc rose 3.2 percent to $3.23 in premarket trading after naming Don Mattrick, the head of Microsoft's Xbox business, as its chief executive.

(Editing by Jeffrey Benkoe and Kenneth Barry)


Home prices rise by most in seven years in May: CoreLogic

Tuesday, July 2nd, 2013 | Finance News

NEW YORK (Reuters) - Home prices racked up their biggest annual gain in more than seven years in May, with more increases expected through the summer months as the sector continues to mend, data analysis firm CoreLogic said on Tuesday.

Prices rose 2.6 percent from April and were up 12.2 percent compared to May last year, the biggest year-over-year increase since February 2006, CoreLogic said.

Excluding distressed sales, prices were up 11.6 percent on a yearly basis. Distressed sales include properties that have been seized by lenders and short sales, where the struggling homeowner is allowed to sell the property for less than the outstanding mortgage.

The recovery in the housing sector has gained momentum this year, with tight inventory pushing prices higher. Still, prices nationally remain cheap compared to during the housing boom, which has spurred demand from investors and homeowners.

The acceleration in prices compared to a year ago was in line with the closely watched S&P-Case/Shiller report which showed prices rose more than 12 percent on an annual basis in April.

"Across the country, pent up demand and continued low interest rates are fueling strong demand for a limited inventory of properties," Anand Nallathambi, CoreLogic's chief executive officer, said in a statement.

"We expect that trend to continue to drive up prices throughout the balance of the summer months."

The report forecast prices will rise by another 2.9 percent in June for a yearly gain of 13.2 percent.

Nevada saw the biggest price increases, followed by California, Arizona, Hawaii and Oregon.

(Reporting by Leah Schnurr; Editing by Chizu Nomiyama)