New U.S. single-family home sales rebounded in July and consumer confidence increased to a seven-month high in August, pointing to underlying strength in the economy that could still allow the Federal Reserve to raise interest rates this year.
The dollar jumped one percent against a basket of major currencies on Tuesday and recovered from seven-month lows against the safe-haven yen and euro as riskier assets got a boost from an interest rate cut by the Chinese central bank.
U.S. single-family home prices rose a tad faster from a year ago in June, suggesting resilience in the housing sector as the Federal Reserve has stuck to a near-zero interest rate policy, a closely watched survey said on Tuesday.
Investors in U.S. stocks have been arguing that a 10% decline of the S&P 500 was long overdue and a missing link of a healthy market. The benchmark index hasn't had a by-the-book correction in about four years.
The euro and yen climbed to a seventh-month peak against the dollar on Monday as investors, worried about the slowdown in China, reversed riskier bets in so-called "carry trades" and bought back the low-interest rate currencies used to fund those assets.
The rout in U.S. stocks continued for the fourth straight day on Friday, with all three major indices down more than 1 %, as fears of a China-led global slowdown were heightened after grim data overnight.
Bond investing guru Bill Gross of Janus Capital Group Inc said in a tweet on Wednesday that the U.S. Federal Reserve will hike rates in September as financial market conditions take precedence over economic conditions.