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Stocks holding in range near highs

David Russell (david.russell@optionmonster.com)

Stocks are holding in a tight range near record highs today as investors await more news on housing.

S&P 500 futures are off 0.1 percent. Most of Europe is down slightly more, and Asia was little-changed overnight. Oil and currencies associated with global growth are also trying to rebound from long-term lows on strong Chinese manufacturing numbers.

The S&P 500 has spent the last three sessions above 2100, having broken out of a two-month consolidation in mid-February. While the economic data has been mixed, employment numbers have gradually improved and investors remain willing to put money to work in equities. Federal Reserve Chair Janet Yellen also removed worries of higher interest rates in her address to the Senate yesterday.

Mortgage applications for home purchases rose this morning, and now attention will turn to sales of new dwellings at 10 a.m. ET. Stocks associated with housing have started to run in the last month on strong earnings. Home Depot, for instance, shot to a new all-time high yesterday and Lowe's is following today. Call buyers are also betting that PulteGroup will rally into the summer.

Yellen returns to Capitol Hill at 10 a.m. ET, and crude-oil inventories are released 30 minutes later. Tomorrow's agenda remains active, with weekly jobless claims, durable-goods orders, and inflation data.

In other company-specific news, Hewlett-Packard fell almost 6 percent on weak revenue. Dreamworks Animation dropped 9 percent after missing estimates on the top and bottom lines. Chico's FAS is down more than 7 percent after Sycamore Partners stopped an attempt to buy the retailer. Papa John's may also head lower today after management issued weak guidance for 2015. Target gained 2 percent after beating estimates.

In addition to housing, the last week has also seen strength in biotechnology, solar energy, European stocks and utilities. Energy and precious metals have fared the worst.

Oil rose about half a percent, partially because of comments by Saudi Arabia that oil demand is growing. Gold rose almost 1 percent, and silver gained 2 percent. The Australian and Canadian dollars, which are associated with global growth, surged on the strong Chinese numbers, while the euro is modestly higher.

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