- The Washington Times - Wednesday, August 26, 2009

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 following a recent surge.

The improvements in consumer confidence and housing are related. If consumers are feeling better about the economy, they will be willing to spend a little more on houses, not to mention cars, appliances and other goods and materials. Investors’ concerns about flagging consumer confidence have triggered bouts of stock selling in recent weeks.

Stocks also got a boost from President Obama’s reappointment of Ben S. Bernanke as Federal Reserve chairman. Mr. Bernanke’s reappointment, though expected, came sooner than anticipated and removed any uncertainty about a potential replacement.

The Dow Jones Industrial Average 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.

In other trading, the Russell 2000 index of smaller companies rose 2.98, or 0.5 percent, to 583.22.

Energy-related stocks fell after oil prices tumbled $2.32 to $72.02 a barrel on the New York Mercantile Exchange. Prior to trading Tuesday, prices had climbed 8.1 percent in just 5 days. Halliburton Co. fell 76 cents, or 3 percent, to $24.52. Chesapeake Energy Corp. lost 59 cents, or 2.5 percent, to $23.35.

Homebuilders posted some of the biggest gains Tuesday after the release of the home-price data. Hovnanian Enterprises Inc. jumped 6.5 percent, adding 28 cents to $4.57, while Lennar Corp. rose 40 cents, or 2.8 percent, to $14.97.

Financial stocks rebounded after sagging on Monday in response to an analyst’s downbeat report. Bank of America Corp. rose 40 cents, or 2.3 percent, to $17.75. Retailers also rose. Shares of Big Lots Inc. soared more than 6 percent, rising $1.57 to $25.60 after its second-quarter results beat analysts’ expectations and the discount retailer raised its full-year earnings forecast.

Bond prices came off earlier lows and moved slightly higher after an auction of $42 billion in two-year notes was met with adequate demand. The yield on the benchmark 10-year Treasury note fell to 3.44 percent from 3.48 percent late Monday. The yield on the two-year note slipped to 1.02 percent from 1.03 percent.

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