After sharp losses in the previous session, U.S. stocks rallied overnight after better than expected earnings results from home improvement retailer Home Depot and discount retailer Target - helping to boost investor confidence.
The Dow Jones industrial average up 83 points to 9,218. The S&P500 Index gained 10 points to 990 and the NASDAQ rose 25 points to 1,956.
In economic news: The U.S. Commerce Department reports that housing starts fell to an annual rate of 581,000 in July, down from 587,000 in June. Economists though it would rise to 599,000.
Building permits also dropped, falling to an annual rate of 560,000 in July from 570,000 in June. Economists thought it would rise to 576,000.
And the Producer Price Index fell 0.9 per cent in July after rising 1.8 per cent in June. Economists thought it would fall to 0.3 per cent.
In company news: Shares in home improvement retailer Home Depot Inc (NYSE:HD) rose 3.14 per cent to $26.93. The retailer posted profit of 66 cents a share, down from 77 cents a share a year ago, however the result came in above expectations. Home Depot also upgraded its full year outlook.
Shares in general merchandise retailer Target Corporation (NYSE:TGT) added 7.55 per cent to $44.32. The discount retailer reported lower earnings of 79 cents a share compared to 82 cents a year earlier, beating estimates. Revenue and same-store sales fell however, as customers remain cautious. Health care company Cardinal Health Inc (NYSE:CAH) shares gained 2.55 per cent to $34.21. The company announced net profit for the fourth quarter that dropped 14 per cent from a year earlier, however it upgraded its full year guidance for its stand-alone cardinal business.
And shares in bio pharmaceutical company Novavax Inc (NASDAQ:NVAX) advanced 7.57 per cent to $4.83. According to Reuters the company says it has found that a new kind of flu vaccine works against the new strain of swine flu in animals.
Checking the NASDAQ Top 100: The best performing stock on the Nasdaq overnight was Flextronics which rose 6.88 per cent to $5.59. While Paccar and Research in Motion also closed stronger. The worst performing stock was Comcast Corp which fell 1.51 per cent to $14.34. While Dish Network and First Solar also closed lower.
