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Stock market rebounds from worst slump of the year

Steve Rothwell, AP Markets Writer

Traders on the floor of the New York Stock Exchange observe a moment of silence, Tuesday, April 16, 2013, to honor the victims and families of the Boston Marathon bombings. Stocks are sharply higher in early trading, a day after the market's worst drop this year, as the government reported a surge in home construction last month. (AP Photo/Richard Drew)

NEW YORK (AP) -- Good news on housing and earnings helped stocks rebound from their worst day of the year.

The Dow Jones industrial average rose 83 points, or 0.6 percent, to 14,682 as of 10:20 a.m. EDT, winning back some of the 265 points it lost a day earlier.

Home construction topped 1 million last month for the first time last month, the highest level since June 2008. Strong earnings from big companies including Coca-Cola also propelled the market higher.

Optimism about housing and a pickup in hiring were major catalysts driving the stock market's surge early this year. The Dow Jones industrial average and the Standard & Poor's 500 surged 11.3 percent and 10.3 percent in the first three months of the year respectively.

The rally was interrupted Monday when stocks logged their biggest drop since November. Worries about an economic slowdown in China led to a steep drop in prices for oil, copper, and other commodities Monday, causing mining and energy stocks to drop sharply.

Many of those stocks were rising Tuesday as commodities markets stabilized. Gold rose $14 percent to $1,374 an ounce, a day after its worst drop since 1983, and copper was little changed. Crude oil fell 91 cents to $88 a barrel.

Materials stocks rose the most of the 10 industry groups in the S&P, after leading the market lower the day before. Freeeport-McMoRan Copper & Gold was up 1.2 percent at $29.61, a day after plunging 8 percent, the biggest drop in the S&P 500 index.

Home builders rose following the housing report. PulteGroup rose 24 cents to $18.16 and Lennar climbed 63 cents to $38.42.

Traders on the floor of the New York Stock Exchange observed a moment of silence to honor the victims and families of Monday's bombing attacks at the Boston Marathon.

In other trading, the Standard & Poor's 500 climbed 11.64 points, or 0.75 percent, to 1,564. The Nasdaq composite rose 20 points, or 0.6 percent, to 3,236.

Among stocks making big moves:

Coca-Cola gained $1.62 to $41.62 after its first-quarter results came in above Wall Street's forecasts. Coke said it struck a deal to start refranchising its business in the U.S., which will lower costs.

W.W. Grainger Inc., which sells power tools and other industrial equipment, rose $14.06 to $239.70 after the company said its first-quarter net income climbed 13 percent.

Yields on U.S. government bonds rose as investors moved money out of safe-haven investments. The yield on the benchmark 10-year Treasury note, which moves inversely to its price, climbed to 1.72 percent from 1.68 percent.