NEW YORK — A rebound in consumer confidence and more healing in the housing industry have put stocks back on an upward path.
Banks, retailers and homebuilders were Tuesday’s biggest winners, helping to lift the major indexes about 0.3 percent. Energy and utility stocks fell sharply as oil prices cooled after a recent surge.
Though investors were pleased by better-than-expected readings on consumers and housing, trading was choppy, as it has been over the past week. Despite improving economic data, the market is still generally cautious.
After a climb of more than 45 percent in stocks since early March, investors are questioning how much further the market has to go, especially in the absence of data showing actual growth in the economy. Even though trading has been somewhat erratic, the Dow Jones industrials have carved out a gain of nearly 404 points, or 4.4 percent, in six sessions.
“The upward trend has still not broken,” said Brian Daley, sales trader at Conifer Securities. “It’s too dangerous to fight the trend in the market, even though clearly a lot of people are nervous that it’s too extended.”
Stocks rose after the Conference Board said its Consumer Confidence Index jumped to 54.1 this month from an upwardly revised 47.4 in July. Analysts had expected a reading of 47.5. Still, the report is a long way from showing that consumers are feeling optimistic about the economy amid ongoing worries about job losses. But it does suggest pessimism about the economy is abating.
Meanwhile, the Standard & Poor’s/Case-Shiller U.S. National Home Price Index rose 2.9 percent in the second quarter from the January-March period, the first quarterly increase in three years.
The Dow rose 30.01, or 0.3 percent, to 9,539.29. The Standard & Poor’s 500 index rose 2.43, or 0.2 percent, to 1,028.00, while the Nasdaq composite index rose 6.25, or 0.3 percent, to 2,024.23. About two stocks rose for every one that fell on the New York Stock Exchange, where volume came to 1.14 billion shares.
The market’s moderate advance Tuesday, which came after stocks finished little changed the day before, follows a trend seen throughout the summer, where any dip or pause is met with more buying as investors fear missing out on an extended rally.
“It’s still a trader’s market,” said Steven Stahler, president of the Stahler Group. “You’ve got a lot of activity … but not real legs.”
Analysts expect the market to be volatile through at least the end of the summer, especially with volume and news flow fairly light, as is typical of trading in August.
