[Chart courtesy of MarketWatch.com]
1. Moving the Markets
After an uneventful start to the week, markets here in the U.S. sprang back into action and posted their largest gains since early May. All three major indexes gained at least 1.20% on the day but with volume being downright atrocious, this move is suspect.
The year has been volatile thus far to say the least. A big reason for this volatility has been the Federal Reserve’s on-again, off-again plan to normalize interest rates. However, markets always tend to react well to solid economic data, and it was good news on the housing front that pushed markets higher today.
The Commerce Department reported that sales of new single-family homes jumped almost 17% to an annualized pace of 619,000 in April. That is the highest level since January 2008 and well above the 523,000 new home sales that economists were expecting in April. Of course, extreme numbers like this are likely to be revised sharply, which we will find out next month.
Also providing a lift for stocks Tuesday was a reversal to the upside for U.S. crude, which traded lower in the day, but mounted a strong comeback by the closing bell. A barrel of U.S. crude gained 1.48% on the day to close at $48.78.
And in M&A news, I mentioned yesterday that Monsanto (MON) was being courted for an acquisition by Bayer AG (BAYRY). Well, news stories today were quite clear in stating that Monsanto has officially turned down the $62 billion offer as being “financially inadequate”. A spokesperson from the company did say that they would entertain future offers from Bayer AG though.