Wall St up as US housing shows strength

Trader David O'Day, right, works on the floor of the New York Stock Exchange. File photo / AP

Wall Street moved higher overnight as US Federal Reserve policy makers began their two-day meeting amid further evidence of a recovery in the nation's housing market, while the battle between Greece and its international creditors simmered.

On Wednesday Chair Janet Yellen is to hold a press conference. Investors are eyeing clues about interest rate increases.

"A September hike has been priced in by the market but investors are more keen on seeing the pace of the hike," Eric Wiegand, senior portfolio manager at US Bank Wealth Management, told Reuters.

In late trading in New York, the Dow Jones Industrial Average rose 0.72 percent, the Standard & Poor's 500 Index gained 0.52 percent, as did the Nasdaq Composite Index.

The latest reports on the real estate industry were upbeat. While housing starts fell 11.1 percent in May to a 1.04 million annualised rate, it was the best back-to-back readings since 2007, with a revised 1.17 million rate in April. Separately, building permits climbed 11.8 percent to a seasonally adjusted annual pace of 1.28 million units, also the highest since 2007.

"With the labour market continuing to improve and unemployment coming down, overall conditions for housing should remain pretty favourable," Jim O'Sullivan, chief US economist at High Frequency Economics in Valhalla, New York, told Bloomberg.

Gains in shares of United Technologies and those of Microsoft, last trading 2.1 percent and 1.6 percent higher respectively, propelled the Dow higher.

The relatively steady stream of US corporate deals underpins confidence in the value of stocks, and some have earmarked the health-insurance industry for the next round of M&A activity.

"We continue to see some meaningful activity where M&A is concerned," Wiegand told Reuters.

In Europe, the Stoxx 600 Index finished the day with a 0.6 percent advance from the previous close. The UK's FTSE 100 Index barely budged from the previous close. France's CAC 40 Index and Germany's DAX each rose 0.5 percent.

In Germany, the ZEW Center for European Economic Research's index of investor and analyst expectations dropped more than expected, sliding to 31.5 in June, down from 41.9 in May.

Greece's ASE Index sank 4.8 percent, and the euro fell 0.4 percent to US$1.1237, as Greek Prime Minister Alexis Tsipras dug in his heels against the cash-strapped and debt-laden country's international creditors.

In particular, Tsipras took direct aim at the International Monetary Fund, saying the IMF had "criminal" responsibility for Greece's current financial situation.

"The reaction in the currencies market to the development of Greek negotiations has been restrained," Sireen Harajli, a strategist at Mizuho Bank. in New York, told Bloomberg. "The market has a lot of confidence a deal will be reached last minute."