Stock markets in the U.S. and Europe were on the rise Wednesday as investors looked beyond the steep costs to rebuild Japan, the conflict in Libya and a bad report on new home sales in the U.S.
The S&P Retail Index gained 0.9 percent, or 4.52 points, to 503.36. And the Dow Jones Industrial Average rose 0.6 percent, or 67.39 points, to 12,086.02—leaving blue chip stocks about 15 percent below their all-time high set in October 2007. The FTSE 100 increased 0.6 percent in London and the CAC 40 advanced 0.5 percent in Paris.
In Tokyo, the Nikkei 225 retreated 1.7 percent to 9,449.47 following two straight positive trading sessions. The Japanese government said it could cost as much as 25 trillion yen, or $309 billion at current exchange, to rebuild after the March 11 earthquake, according to published reports.
Officials also warned that infants shouldn’t drink the tap water in Tokyo since it carried more than twice the recommended limit of radioactive iodine. The quake caused a tsunami that claimed more than 20,000 lives and damaged a nuclear power plant northeast of the capital city.
In the U.S., the government said February sales of new single-family homes fell 16.9 percent from the preceding month.
“The market for new homes has been stuck at the bottom for nearly two years and this report is not good news,” said Chris Christopher, senior principal economist at IHS Global Insight. “The new and existing housing markets are in a very precarious situation. Prices and sales are falling; inventory is increasing.”