The Dow Jones Industrial Average closed higher for the 11th time in the past 12 trading days. Yesterday's gains wrapped up the index's eighth consecutive weekly gain, which matches the longest winning streak for the Dow since a two-month stretch that ended in January 2004.
Sales of new homes jumped 27 per cent in March, bouncing off a record low in February, the Commerce Department reported. It was the best month since July and the biggest monthly increase in 47 years. The gains were probably fuelled by customers who are trying to qualify for federal tax credits that will expire at the end of this month.
Stocks got another dose of good news on the housing sector on Thursday, when the National Association of Realtors said sales of existing homes also rose last month.
Joe Heider, principal at Rehmann in Cleveland, said the home sales report is a strong indication that consumers are growing more confident about the economy.
"We're seeing that people have the confidence to make the biggest purchase of their lives," Heider said. "And that bodes well for the markets."
Shares of homebuilders rose for a second day as hopes rose that the troubled housing sector may finally be on the mend.
The Dow rose 69.99, or 0.6 per cent, to 11,204.28. The Standard & Poor's 500 index rose 8.61, or 0.7 per cent, to 1,217.28, while the Nasdaq composite index rose 11.08, or 0.4 per cent, to 2,530.15.
Five stocks rose for every two that fell on the New York Stock Exchange.