NEW YORK (Reuters) - Consumer confidence jumped in June to its highest level in over five years as Americans were more optimistic about business and labor market conditions, according to a private sector report released on Tuesday.
The Conference Board, an industry group, said its index of consumer attitudes rose to 81.4 from a downwardly revised 74.3 the month before. It was the highest since January 2008 and beat expectations for 75.4.
May was originally reported as 76.2.
(Reporting by Leah Schnurr; Editing by Chizu Nomiyama)
WASHINGTON (Reuters) - Sales of new U.S. single-family homes rose to their highest level in nearly five years in May, confirming the housing market's strengthening tone.
The Commerce Department said on Tuesday sales increased 2.1 percent to a seasonally adjusted annual rate of 476,000 units - the highest level since July 2008. It was the third straight month of gains in new home sales.
Sales increased 3.3 percent in April. Economists polled by Reuters had expected new home sales to rise to a 462,000-unit rate last month.
Compared with May 2012, sales were up 29 percent.
Home sales data will be closely watched in the coming months for signs of strain from the rise in mortgage rates.
The housing market recovery, which is helping to soften the blow on the economy from tight fiscal policy, has been largely driven by record-low mortgage rates, thanks to the Federal Reserve's generous monetary stimulus.
The Fed last week said it expected to start slowing the pace of its bond-buying program later this year, bringing it to a halt around the middle of 2014. That has pushed up mortgage rates, which had already been rising since early May.
Economists do not believe the increase in mortgage rates is sufficient to undo the housing market recovery. Data last week showed confidence among home builders spiked to a seven-year high in June and they were upbeat about sales over the next six months and prospective buyer traffic.
Last month, the inventory of new homes on the market increased 2.5 percent to 161,000 - the highest since August 2011 - as builders ramp up production to meet the growing demand.
Still, supply remains tight, putting upward pressure on prices. The median new home price increased 10.3 percent from a year ago.
At May's sales pace it would take 4.1 months to clear the houses on the market, up from 4.0 months in April. A supply of 6.0 months is normally considered as a healthy balance between supply and demand.
Sales last month were up in the Northeast, Midwest and West. They fell in the South. Sales in the Midwest were the highest since November 2007.
(Reporting by Lucia Mutikani; Editing by Andrea Ricci)
LONDON (AP) — Global stocks recovered on Tuesday after China's central bank eased concerns about a credit crunch in the world's second-largest economy and U.S. economic indicators were upbeat.
China's central bank had caused a global rout in markets on Monday when it moved to curb so-called shadow banking — unregulated lending to companies starved of credit by traditional banks. Investors worried that would cause an increase in borrowing rates for companies, hurting business.
On Tuesday, the central bank issued a statement saying it would act to keep credit markets functioning, if needed. That helped stocks rally in Europe and the U.S., though it came too late to help Asia, where the main markets closed lower.
In Europe, Britain's FTSE 100 rose 1.2 percent to 6,100.21 while Germany's DAX gained 1.8 percent to 7,827.66. France's CAC-40 rose 1.5 percent to 3,649.77.
Wall Street also opened higher, with the Dow Jones industrial rising 0.7 percent to 14,759.16 and the broader S&P 500 advancing 0.9 percent to 1,586.62.
Trading was also supported by new figures showing a 3.6 percent rise in U.S. sales of durable goods last month and a 12.1 percent jump in house prices in April. The numbers suggest a firm improvement in the world's largest economy. Investors will later monitor the Conference Board's consumer confidence index for June.
Market sentiment was also supported by European Central Bank President Mario Draghi's reassurances that existing crisis-fighting measures will remain in place.
Draghi said it was important to keep the central bank's bond-buying program, which has helped keep borrowing rates down across Europe for the past nine months, since there is uncertainty surrounding the policies of other central banks. That was a thinly-veiled reference to the Federal Reserve, which is expected to start winding down its monetary stimulus in coming months.
The Fed's bond-buying stimulus program has been keeping rates low, encouraging traders to buy riskier assets such as stocks and to invest in emerging markets, driving many equity indexes to record or multiyear highs. Concern over how markets will handle the end to the program, however, has made investors nervous and caused volatility.
Earlier in Asia, the Shanghai Composite Index fell another 0.2 percent to close at 1,959.51 after trading nearly 6 percent lower earlier in the day and shedding 5 percent the day before, its biggest loss in four years.
Hong Kong's Hang Seng rose 0.2 percent to 19,855.72, overcoming earlier losses, while the Shenzhen Composite Index lost 0.2 percent to 879.93.
Japan's Nikkei 225 shed 0.7 percent to 12,969.34. South Korea's Kospi dropped 1 percent to 1,780.63 and Australia's S&P/ASX 200 was down 0.3 percent to 4,656. Stocks in the Philippines and Indonesia also declined while India and Singapore gained.
In energy markets, the benchmark oil contract for August delivery was up 39 cents to $95.57 per barrel in electronic trading on the New York Mercantile Exchange. The contract rose $1.49 to close at $95.18 in New York on Monday.
In currencies, the euro was down 0.1 percent at $1.3105 while the dollar fell 0.1 percent against the Japanese yen, to 97.61 yen.
Youkyung Lee in Seoul, South Korea, and Fu Ting in Shanghai contributed to this report.