New home sales data boosts Wall Street

US stocks picked up ground on Monday amid a revised outlook from FedEx and a stronger-than-expected report on new home sales.

At the close, the Dow Jones industrial average was up 101 points, or 1%, to 10,525. The Standard & Poor’s 500 Index gained 12 points, or 1.1%, to 1,115, the highest level since June 18, driven by homebuilders and transportation companies. Nasdaq increased 27 points, or 1.2%, to 2,296.

FedEx said it expected to earn $1.05 to $1.25 a share for the first quarter ending August 31, up from earlier estimate of 85 cents to $1.05 a share.

The latest US housing report showed that sales of new homes increased nearly 24% in June from a month earlier to a seasonally adjusted annual sales pace of 330,000.

European indices also inched higher on Monday as investors got their first opportunity to react to the results of the stress tests of European banks.

In London, the FTSE rose 38 points, or 0.7%. Frankfurt’s DAX gained 28 points, or 0.4%, and in Paris, the CAC 40 was 29 points, or 0.8%, higher. The DAX also moved up for the year by 4%.

Asian stocks made small gains as traders awaited the reaction of European markets to the results of stress tests on the region’s banks.

Shanghai recorded its longest rally since November by advancing for a sixth successive session as confidence remained buoyed by optimism that the officials could loosen policy soon. The Composite index rose 0.7% to 2,588, its highest close for a month.

Hong Kong also extended its recent winning run, with the Hang Seng index settling 0.1% higher at 20,840.

The Nikkei 225 closed up 0.8% to 9,503 as the weaker tone of the yen buoyed exporters while optimism over domestic earnings improved.

Strong quarterly sales at Wesfarmers, Australia’s second-biggest retailer, boosted the S&P/ASX 200 index by 0.6% to 4,486.1.

In Mumbai, Maruti Suzuki’s unexpected slide in quarterly net profits weighed on the BSE Sensex index, which shed 0.6% to 18,020.