Dow hits new record on strong economic data

NEW YORK (AFP) - The Dow closed at a new all-time high on Tuesday after strong gains in US home prices and consumer confidence boosted stocks.

The Dow Jones Industrial Average was up 106.29 (0.69 per cent) at 15,409.39, a new all-time high.

The S&P 500 put on 10.46 (0.63 per cent) at 1,660.06, while the Nasdaq Composite Index added 29.74 (0.86 per cent) at 3,488.89.

The widely watched S&P/Case-Shiller index of US home prices showed the price of a home in the 20 largest cities rose 10.9 per cent in the year to March, the largest year-on-year increase since 2006.

Consumer confidence in the US surged to 76.2 in May, up from 69.0 in April, hitting the highest level since February 2008.

Stocks were also boosted by greater confidence that the Federal Reserve would maintain its bond-buying programme and relief that Japan's stock market rose Tuesday, said Art Hogan of Lazard Capital Markets.

"It's a great way to start the week," Mr Hogan said, after markets were closed Monday for a public holiday. "We're going to need a string of good data, not just two points" before stocks go significantly higher, he added.

Utility firm Exelon sank 7.5 per cent after Deutsche Bank downgraded it to "hold" amid expectations for lower power prices from surging supply.

Similarly, FirstEnergy plummeted 6.5 per cent after Credit Suisse downgraded the firm, citing an electricity auction that exposed an industry with "poor discipline by incumbent generators" and "crushing" new capacity that will "inevitably leave energy and capacity prices weak."

Other utilities also fell, but not as steeply. NRG gave up 3.7 per cent, American Electric Power dropped 2.4 per cent, Duke Energy retreated 1.6 per cent and PPL Corp. dipped 1.7 per cent.

Video and live-streaming company Netflix gave up 6.4 per cent after the return of the Arrested Development show garnered mixed reviews.

Luxury jeweler Tiffany jumped 4.0 percent after reporting 70 cents per share in earnings, well above the 52 cents forecast.

Bond prices fell sharply. The yield on the 10-year US Treasury rose to 2.14 per cent from 2.01 per cent late Friday, while the 30-year jumped to 3.29 per cent from 3.17 per cent. Bond prices move inversely to yields.

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