After Market: Home Sales Rise Is Welcome News to Investors

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Housing stocks helped the market build modest gains Thursday. The Dow Jones industrial average (^DJI) added 10 points, and the Standard & Poor's 500 index (^GPSC) rose 4, ending the day just 5 points from the record high set last week. But the Nasdaq composite (^IXIC) was the standout gainer, up 22 points, about 0.5 percent.

Sales of existing homes rose last month, easing some concerns that housing market weakness would keep the economy in the slow lane. Beazer (BZH) jumped 5 percent and Hovnanian (HOV) gained 3 percent. D.R. Horton (DHI), Lennar (LEN), Pulte (PHM) and Toll Brothers (TOL) all rose about 2 percent. The online real estate company Zillow (Z) gained nearly 5 percent.

The IPO of Chinese Internet retailer JD.com (JD) sparked lots of attention. It rose 8½ percent from its $19 a share initial pricing. The offering valued the company, known as the Amazon.com of China, at $26 billion.

But other Chinese stocks that trade here had a rough day. Weibo (WB) fell 11 percent and Sina (SINA) fell 10 percent. Both issued weak earnings forecasts. China Precision Steel (CPSL) tumbled 19 percent.

Retail stocks have had a rough week as many companies posted disappointing sales numbers, but there were some gains in the sector today.
  • Dollar Tree (DLTR) gained 6½ percent on solid earnings and an increase in customer traffic.
  • Williams-Sonoma (WSM) rose 8 percent after topping expectations.
  • Best Buy (BBY) also beat, and the stock rose 3½ percent.
  • Bon-Ton Stores (BONT) rose 5 percent, despite missing the Street's target.
  • Even Sears (SHLD) rose 4 percent despite another sales decline. But over the past 6 months, Sears stock has lost 21 percent.

Biotech was another strong sector. Amgen (AMGN) and Biogen (BIIB) both added 1 percent. Isis Pharmaceuticals (ISIS) jumped 7½ percent after reporting success in a mid-stage trial of its experimental blood thinner.

Elsewhere, ITT Educational Services (ESI) tumbled 20 percent after withdrawing its full year earnings forecast. It also said student enrollment at its for-profit schools declined in the first quarter.

And the digital coupon firm RetailMeNot (SALE) slid 19 percent. It reportedly lost a third of its web traffic following recent changes to Google's search algorithm.

What to Watch Friday:
  • The Commerce Department releases new home sales for April at 10 a.m. Eastern time.
  • Foot Locker (FL) releases quarterly financial statements before U.S. markets open.
-Produced by Drew Trachtenberg.


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