* Existing home sales jump in November
* Window dressing lifts the rally's leaders
* Dow up 0.5 pct; S&P 500 up 0.4 pct; Nasdaq up 0.7 pct
* For up-to-the-minute market news, click STXNEWS/US
(Updates to close)
By Leah Schnurr
NEW YORK, Dec 22 (Reuters) - U.S. stocks logged another
14-month high on Tuesday as a surge in existing home sales
indicated more stabilization in housing and boosted optimism
about the economic recovery.
Housing stocks led the way up with the Dow Jones U.S. home
construction index <.DJUSHB> up 3.9 percent following data that
showed U.S. existing home sales rose in November at the
fastest pace since February 2007. For details, see
[]
Shares of D.R. Horton Inc <DHI.N> rose 3.8 percent to
$11.15, while Toll Brothers Inc <TOL.N> gained 4.5 percent to
$19.21.
"We definitely had a positive reaction off the housing
numbers," said Ryan Detrick, senior technical strategist at
Schaeffer's Investment Research in Cincinnati.
Any sign of stabilization in housing lends a big boost to
investor sentiment. It was the fallout from that sector's
downturn that recently drove the economy into its worst
recession since the 1930s and propelled the U.S. unemployment
rate above 10 percent to a 26-year high.
"The housing numbers were very, very strong," Detrick
added, "and that's what we've been seeing for several months."
Technology bellwethers also underpinned the market and
helped the Nasdaq log a fresh 15-month high. International
Business Machines Corp <IBM.N> shot up 1 percent to $129.93 on
the NYSE after the blue-chip company scored a 10-year
outsourcing deal valued at $83 million. [] Among
the Nasdaq's main advancers, Microsoft Corp <MSFT.O> was up 1
percent at $30.81.
The Dow Jones industrial average <> rose 50.79 points,
or 0.49 percent, to end at 10,464.93. The Standard & Poor's 500
Index <.SPX> added 3.97 points, or 0.36 percent, to 1,118.02.
The Nasdaq Composite Index <> gained 15.01 points, or 0.67
percent, to close at 2,252.67.
The CBOE Volatility Index <.VIX> or VIX, Wall Street's
favorite barometer of investor fear, fell below a key
psychological level of 20 to its lowest level since August
2008. The Vix slid 4.6 percent to close at 19.54.
Earlier in the session, the S&P 500 <.SPX> hit a technical
milestone, surging to an intraday high of 1,120.27. The index
failed to hold that level, but it did reach a 14-month closing
high.
Year-end window dressing -- where portfolio managers sell
laggards and buy shares that have gained recently -- gave an
extra boost to stocks that have led the rally.
Market technicians have said a breakout in the S&P 500
above the 1,120 level would signal more gains for the broader
market and could help the S&P 500 take aim at the 1,200 level.
The S&P 500 has risen 65.3 percent since hitting a 12-year
closing low on March 9. For the year, the S&P 500 is up 23.8
percent.
Apple Inc <AAPL.O>, which has surged 134.8 percent this
year, was up 1.1 percent at $200.36, not far below its 52-week
high set on Oct. 21.
Boeing Co <BA.N> gave the Dow one of its biggest lifts,
rising 1.5 percent to $55.10 after it bought a stake in a U.S.
plant that assembles the fuselage for its 787 Dreamliner.
[]
A separate economic report that gave the final estimate of
gross domestic product showed that GDP grew at an annual rate
of 2.2 percent in the third quarter -- below the forecast for a
gain of 2.8 percent.
(Reporting by Leah Schnurr; Editing by Jan Paschal)
