US housing market attracts buyers

The Dow Jones industrial average rose 69 points to 12,874 in the first 1 ½ hours of trading, overcoming an early deficit of 50 points. The Dow has had a miserable July so far, marking only its third gain for the month on Tuesday.Stocks of homebuilders rose after the government reported that builders broke ground last month on the most new homes and apartments in nearly four years. The 6.9 percent jump brought the number of housing starts to the highest since October 2008. The news came a day after a gauge of confidence among U.S. homebuilders jumped to the highest level in five years.In other trading, the Standard & Poors 500 index rose nearly seven points to 1,370.The technology-focused Nasdaq composite climbed 26 points to 2,936.Investors were watching Federal Reserve Chairman Ben Bernankes comments to Congress see if the central bank may be close to launching another round of bond purchases. In the first hour of testimony, he did not signal any new stimulus was imminent, though he said the Fed was looking at ways to address the weakness in the economy should more action be needed to promote a sustained recovery in the labor market.Bernanke was speaking to Congress on his second day of testimony on the state of the economyOther earnings reports werent as strong. Bank of America reported income that beat most analysts expectations for the second quarter, but its revenue fell short.American Airlines, which filed for bankruptcy protection in November, reported Wednesday that it is still losing money. Parent company AMRs second-quarter loss narrowed to $241 million mostly because of $230 million in costs tied to its bankruptcy restructuring. A year ago, it lost $286 million.At the start of the earnings season last week, Wall Street analysts expected earnings for S&P 500 companies to fall 1 percent, according to S&P Capital IQ. That would be the first drop in nearly three years. Later today, IBM, eBay, American Express and Yum Brands, owner of Taco Bell, KFC and Pizza Hut, report earnings.So far, several large companies have delivered pleasant surprises in their earnings reports. Honeywell International, a big technology and manufacturing company, reported an 11 percent increase in second-quarter income Wednesday, more than Wall Street was expecting, thanks to higher demand for its products. Honeywell also raised its forecast for full-year profits. Honeywells stock jumped $3.62 to $58.16.Another big winner was Vivus Inc., a drug maker. It rose 13 percent after announcing it got approval from regulators to sell a new weight-loss pill. Doctors consider the pill, Qsymia, the most effective of a new generation of anti-obesity drugs. The company plans to start selling it by the end of the year.Treasury prices rose slightly as demand for low-risk assets remained strong. The yield on the benchmark 10-year Treasury note fell to 1.48 percent from 1.50 percent late Tuesday. Germany auctioned $6.14 billion in two-year treasury notes Wednesday with an average interest rate, or yield, of minus 0.06 percent.