Wall St gains as US housing, Tiffany sparkle

Wall Street gained as better-than-expected American housing data helped bolster shares of homebuilders while an upgraded profit outlook lifted shares of Tiffany.

In afternoon trading in New York, the Dow Jones Industrial Average added 0.16 per cent, while the Standard & Poor's 500 Index rose 0.19 per cent, and the Nasdaq Composite Index gained 0.56 per cent.

After disappointing pending home sales data released yesterday, today's report painted a brighter picture for the industry. Building permits climbed 6.2 per cent in October to an annual rate of 1.03 million units, according to the Commerce Department.

It was the highest level since June 2008 and surpassed economists' forecasts.

Separately, the S&P/Case Shiller composite index of home prices in 20 metropolitan areas posted its highest increase since February 2006, soaring 13.3 per cent in September from a year ago.

These signs of strength in the real estate industry will also be noted by the monetary policy makers.

"The jump in building permits means that another obstacle to tapering is now removed," Harm Bandholz, chief US economist at UniCredit Research in New York, told Reuters. "The weakness in housing starts and new home sales were probably one important reason-besides the slowdown in payroll gains-why the Fed did not taper in September."

Even so, the US consumer is feeling less upbeat. Consumer confidence sank to the lowest level in seven months, as the Conference Board's reading unexpectedly dropped to 70.4 in November, from 72.4 in October.

Another report, from the Federal Reserve Bank of Richmond, showed the overall business activity index for mid-Atlantic region factories increased to 13 this month.

Gains in shares of Walt Disney, last up 1.8 per cent, and Home Depot, last up 1.2 per cent, propelled the Dow higher. Shares of Intel and Exxon Mobil were the biggest losers in the Dow, declining 0.9 per cent and 0.6 per cent respectively.

Shares of Tiffany jumped, last up 8.6 per cent, after the company posted third-quarter profit that exceeded analysts' expectations, and it lifted its annual earnings forecast.

"Worldwide sales growth in the quarter demonstrated the growing power of the Tiffany & Co brand and the benefits of our expanding global presence," Tiffany Chairman and CEO Michael Kowalski said in a statement.

"Operating earnings rose faster than sales, reflecting favourable product cost trends and ongoing well-controlled expenses. We're experiencing excellent customer response to our expanded fashion jewellery designs, highlighted by the ATLAS collection, as well as continued growth in our fine and statement jewellery, with particular strength in our yellow diamond collection," Kowalski said.

In Europe, the Stoxx 600 Index ended the session with a 0.6 per cent slide from the previous close, as did France's CAC 40. The UK's FTSE 100 Index sank 0.9 per cent, while Germany's DAX slipped 0.1 per cent.