Futures Climb After Jump in Housing Starts

Futures pointed higher Tuesday after a report showed a rebound in housing starts from record lows.

This came after the worst day for stocks in a month, when major averages shed more than 2 percent and the CBOE Volatility Index ended at nearly 31 after a key manufacturing gauge came in weaker than expected.

  • Dow 30: Extra-Hours Quotes
  • Pre-Markets/Futures Data
  • Monday's 187-point loss for the Dow was the first time in 10 sessions the Industrial Average had chalked up a triple-digit move in either direction — earlier this year, triple-digit moves were the norm rather than the exception.

    Tuesday's data were brighter: Housing starts jumped 17.2 percentin May, mostly due to a surge in multifamily construction, after sliding 12.9 percent in April. New building permits, a gauge of future building activity, rose 4 percent, the biggest gain since last June.

    And inflation remained pretty tame: Producer prices climbed 0.2 percent in May, while core prices, which exclude the volatile food and energy components, slipped 0.1 percent. Economists had expected a much sharper 0.6-percent increase amid rising energy prices.

    Still to come: The Federal Reserve will release industrial production and factory capacity utilization numbers at 9:15 am. Consensus calls for a 0.9 percent drop in industrial production for May, with factory capacity utilization at 68.4 percent.

    Investors will also watch for market moving comments from Fed governor Kevin Warsh, who will speak on economic policy at 1:15 pm.

    Though the earnings calendar is relatively light, one report on the day's docket could be a market mover, as electronics retailer Best Buy reports its quarterly numbers. The report will be watched closely both as a general indication of the state of the U.S. consumer, as well as how much Best Buy has been able to take advantage of the disappearance of competitor Circuit City . That number should be out at 8 am New York time.

    Elsewhere in the markets, Duncan Energy Partners said Monday it is offering 8 million common shares representing limited partner interests.

    The company said it will use the proceeds to repurchase an equal number of its common units owned by affiliates of Enterprise Products Partners LP at the same net price per unit, after deducting underwriting discounts and commissions.

    Duncan shares fell 1.2 percent in active premarket trading.

    - Peter Schacknow, Senior Producer, CNBC.com, contributed to this report.