Dow up 32 as Wall St. cheers housing strength

Updated: 7:09 p.m. ET

A quiet rally for stocks looked like it might become something much stronger, but the gains faded at the close.

The rally was spurred in part by the April Standard & Poor's / Case-Shiller price index report saying home prices increased in April from March in 19 of 20 major markets. Housing stocks were higher as a result. The report offset a disappointing report on consumer confidence from The Conference Board.

Amazon.com (AMZN) was up $5.54 to $225.61 on reports that a new version of its Kindle reader will come out on July 31.

News Corp. (NWSA) shares were up $1.68 to $21.76 after the company confirmed it's studying splitting into two companies: a broadcasting-enterta​inment giant and a publishing business that would include newspapers and book publishing. News Corp. owns Fox Broadcasting, Fox News and The Wall Street Journal.

Crude oil (-CL) rebounded in late-day trading to $79.36 a barrel in New York. Brent crude and natural gas also were higher because of a heat wave hitting the South and western plains. Gold (-GC) dropped in New York. At the same time, corn jumped 30 cents, or 3.2%, to $6.24 a bushel because of worries about the heat wave and drought in the Midwest. Corn (-ZC) has jumped 13.5% this week alone. Wheat (-ZW) is up 8.3% this week. 

The Dow Jones industrials ($INDU) were up as many as 74 points at 3:20 p.m. ET. But the gain faded in the last 40 minutes of trading, and the blue-chip index finished up 32 points to 12,535. The Standard & Poor's 500 Index ($INX) gained 6 points to 1,320, and the Nasdaq Composite Index ($COMPX) rose18 points to 2,854.

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The Nasdaq-100 Index ($NDX) climbed 16 points to 2,550, thanks in part to gains in Amazon.com, News Corp., Microsoft (MSFT) and Oracle (ORCL). (Microsoft publishes MSN Money.)

Apple (AAPL), which exerts the largest influence on the Nasdaq-100, rebounded from morning losses and closed up $1.26 to $572.03.

Consumer discretionary stocks were the market's strongest sector, followed by energy and financial stocks. All 10 sectors were higher. The weakest was industrial stocks. Health care stocks were mostly higher.

Among the discretionary stocks moving up were housing and such stocks as Best Buy (BBY), Whole Foods Market (WFM), Staples (SPLS), Nordstrom (JWN) and Fossil (FOSL).

Best Buy was up 86 cents to $19.37. The stock reached $21.59 on reports that founder Richard Schulze might try to take the company private and hired Credit Suisse to advise him. But to call a special shareholders meeting to discuss change in control of the company requires an investor owning 25% of the common shares. The stock dropped back at the close.

Apollo Group (APOL), operator of the University of Phoenix college system, was the leader of the S&P 500 and the Nasdaq-100 after reporting better-than-expected​ profits late Monday.  Shares were up $3.34 to $35.81.

The week's big drama will come Thursday when European leaders hold an economic summit in Brussels and the Supreme Court issues its ruling on the health care reform law's constitutionality. In addition, the government will issues reports on jobless claims and the last revision to first-quarter gross domestic product.

Nike (NKE) and Research In Motion (RIMM) will report after Thursday's close.

Energy prices -- New York close
			Tues.			Mon.			Month chg.			YTD chg.
Crude oil (-CL)			$79.36			$79.21			-8.29%			-19.70%
(per barrel)
Heating oil (-HO)			$2.5732			$2.5348			-4.81%			-11.70%
(per gallon)
Natural gas (-NG)			$2.8070			$2.7340			15.90%			-6.09%
(per mil. BTU)
Unleaded gasoline (-RB)			$2.5229			$2.4982			-7.34%			-5.06%
(per gallon)
Brent crude			$93.02			$91.01			-8.62%			-13.37%
(per barrel)
Retail gasoline			$3.3970			$3.4110			-6.16%			3.69%
(per gallon; AAA)

Housing shows signs of stabilizing
The S&P/Case-Shiller Index showed prices rising 1.3% from March to April, the first gain after seven months of declines. Prices were still down 2% from a year ago.

But the month over month gain was new and different. Nineteen of 20 markets showed month-over-month gains. Only Detroit was negative.

"It has been a long time since we enjoyed such broadbased gains," said David Blitzer, chairman of the Index Committee, which manages the report.

The report seems to buttress reports of stabilization around the country. New-home sales in May were better than expected. How long the home-price rally can last is debatable. Capital Research, the global economic consulting firm, believes a large supply of foreclosed homes will come up for sale, putting a lid on prices.

PulteGroup (PHM) was up 49 cents to $9.72. D.R. Horton (DHI) added 58 cents to $16.87. Ryland (RYL) added 91 cents to $24.21. The Philadelphia Housing Sector Index ($HGX) rose 3.21 to 125.69.

Consumer confidence slides
The Conference Board's index of consumer attitudes fell to 62.0 from a downwardly revised 64.4 in May, falling short of economists' expectations. It was the lowest level since January.

While consumers' assessment of their current situation improved, they were less upbeat about their expectations for the next six months. Fewer respondents expected business conditions or employment would improve in the coming months.

"It's the future they're more scared about, and I can't say I disagree with that concern given European problems, fiscal cliffs and all the various challenges that will present over the next six months," Eric Lascelles, chief economist at RBC Global Asset Management in Toronto, told Reuters.

But Ian Shepherdson of High Frequency Economics thinks a strong stock market since early June and falling gasoline prices, both heavy influence on the index, will improve confidence levels.

Europe to discuss a banking union

Euro-zone countries should transfer oversight of their banks to a European supervisor, possibly the European Central Bank, a new proposal suggested today.

In return, the eurozone's bailout fund would help insure deposits and wind down failing lenders. The hope would be to prevent full-scale runs on banks in, say, Greece, Italy, Spain Portugal and Ireland. Greece and Spain have both experienced large deposit outflows, with the money migrating to banks in Germany and the Netherlands, which are perceived to be financially stronger.

The proposal came in a report that will be debated at their summit Thursday. It came as markets in Europe were closing. 

Sixteen of the 30 Dow stocks were higher, led by Chevron (CVX), General Electric (GE) and Exxon Mobil (XOM). Kraft Foods (KFT) and Hewlett-Packard (HPQ) were the laggards.

A total of 338 S&P 500 stocks were higher, led by Apollo Group and News Corp. Frontier Communications (FTR) and Harley Davidson (HOG) were the laggards.

Seventy-one Nasdaq-100 stocks were higher, led by News Corp. and Amazon.com. Cisco Systems and Cognizant Technology Solutions (CTSH) were the laggards.

Crude oil and gold move lower
Crude oil was up 15 cents to $79.36 a barrel in New York. Brent crude had gained $1.99 to $93 a barrel.

The national average price of gasoline fell to $3.397 from Monday's $3.411, according to AAA's Daily Fuel Gauge Report. That's the lowest price since Jan. 27. The price is down 15.8% from the early April peak of $3.936 a gallon.

Gold dropped $13.50 to $1,574.90 an ounce. Silver (-SI) was off 48.2 cents to $27.038 an ounce. Copper (-HG) slipped 0.3 cents to $3.313 a pound.

Interest rates were higher, with the 10-year Treasury yield rising to 1.628% from Monday's 1.608%.

The dollar was higher against the euro but lower against most other currencies.

Short hits from the markets -- New York close
			Tues.			Mon.			Month chg.			YTD chg.
Treasury yields
13-week Treasury bill			0.0900%			0.080%			28.57%			800.00%
5-year Treasury note			0.724%			0.709%			7.90%			-12.77%
10-year Treasury note			1.628%			1.608%			2.97%			-12.99%
30-year Treasury bond			2.698%			2.682%			0.97%			-6.61%
Currencies
U.S. Dollar Index			82.539			82.662			-0.71%			2.50%
British pound			1.5652			1.5579			1.55%			0.74%
(in U.S. $)
U.S. $ in pounds			£0.639			£0.642			-1.53%			-0.73%
Euro in dollars			$1.25			$1.25			1.14%			-3.51%
(in U.S. $)
U.S. $ in euros			€ 0.800			€ 0.800			-1.12%			3.64%
U.S. $ in yen			79.62			79.64			1.35%			3.26%
U.S. $ in Chinese			6.38			6.36			0.05%			0.93%
yuan
Canada dollar			$0.978			$0.972			0.94%			-0.36%
(in U.S. $)
U.S. dollar			$1.024			$1.029			-0.93%			0.36%
(in Canadian $)
Commodities
Gold (-GC)			$1,574.90			$1,588.40			0.68%			0.52%
(per troy ounce)
Copper (-HG)			$3.313			$3.316			-1.56%			-3.58%
(per pound)
Silver (-SI)			$27.0380			$27.5200			-2.59%			-3.14%
(per troy ounce)
Wheat (-ZW)			$7.2900			$7.2425			13.24%			11.68%
(per bushel)
Corn (-ZC)			$6.2400			$5.940			12.38%			-3.48%
(per bushel)
Cotton			$0.6820			0.7005			-4.68%			-25.61%
(per pound)
Coffee			$1.6575			1.5875			1.72%			-27.82%
(per pound)
Crude oil (-CL)			$79.36			$79.21			-8.29%			-19.70%
(per barrel)