US stocks close high on positive home sales data

<p>The main US stocks closed higher yesterday as home sales data buoyed the markets.</p>

The major Wall Street benchmarks closed on a strong footing last night (February 27th), after official property purchasing data picked up in January.

New home sales in the US – which are a lead component of past recoveries – surged by 16 per cent in January to the highest rate since July 2008.

The S&P/Case-Shiller index of property values advanced by 6.8 per cent from December 2012, which is the biggest year-to-year gain since July 2006, after advancing by 5.4 per cent in November.

Near record-low borrowing costs and gains in employment are fueling demand and driving up the value of properties as the number of houses on the market falls and foreclosures dwindle.

These market improvements are shoring up household net worth and confidence, which may help underpin consumer spending even as a rise in payroll tax chips away at take-home pay.

When the markets finished for the day yesterday, the Dow Jones rose by 0.8 per cent to an index value of 13900.1 points, while the Nasdaq rallied by 0.4 per cent to 3129.6 per cent.

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