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U.S. Stock Futures Rise on Economic Data as Home Depot Climbs

Aug. 19 (Bloomberg) -- U.S. stock futures advanced, after the Nasdaq Composite Index climbed to a 14-year high, as housing starts jumped to the highest level in eight months and an inflation gauge showed price pressures remain limited.

Home Depot Inc. gained 3.8 percent after earnings topped analysts’ estimates and the company raised its forecast. Aeropostale Inc. advanced 8 percent after saying Julian Geiger has returned as chief executive officer.

Futures on the Standard & Poor’s 500 Index expiring in September rose 0.3 percent to 1,973.80 at 8:35 a.m. in New York, while Nasdaq 100 Index contracts gained 0.3 percent. Dow Jones Industrial Average futures climbed 62 points, or 0.4 percent, to 16,855 today.

The S&P 500 rose 0.9 percent yesterday as concern eased over the Ukraine crisis. The S&P 500 fell as much as 3.9 percent from a record reached on July 24 amid growing concern over global conflicts from Ukraine to Gaza and Iraq. The benchmark index gained 1.2 percent last week as signs of a slowing economy stoked bets central banks will leave interest rates near record lows for longer.

Jackson Hole

The Federal Reserve will release the minutes of its last gathering tomorrow, before central bankers meet in Jackson Hole, Wyoming. Fed Chair Janet Yellen and European Central Bank President Mario Draghi will be among the speakers at the annual symposium on monetary policy.

The Fed is watching economic data to help gauge adjustments to monetary stimulus. The central bank remains on pace to wind down its monthly bond purchases in October. Yellen has said officials will keep its benchmark interest rate low for a “considerable time” after the bond buying ends.

Beginning home construction climbed 15.7 percent to a 1.09 million annualized rate in July, following June’s 945,000 pace, which was stronger than previously reported, the Commerce Department reported today in Washington. The level exceeded the highest estimate in a Bloomberg survey of economists, whose median projection called for 965,000 starts.

The cost of living in the U.S. climbed in July at the slowest pace in five months, indicating price pressures remain limited even as the economy picks up.

The Nasdaq Composite rallied 1 percent to its highest level since March 2000 yesterday. The gauge ended the day 13 percent above its February low. The last time the measure closed this high, on March 31, 2000, it went on to sink 46 percent through the end of that year as the dot-com bubble burst.

Internet Stocks

The Dow Jones Internet Composite Index and the Nasdaq Biotechnology Index closed yesterday at the highest levels since March. Both indexes have recovered most of their losses from March and April, when investors sold off the best performers during the five-year bull market amid concern valuations had become too expensive.

The S&P 500 is trading at 17.7 times the reported earnings of its companies, near the highest level since 2010. It is within 0.8 percent of an all-time high reached July 24.

Home Depot advanced 3.8 percent to $86.75 today. Chief Executive Officer Frank Blake has focused Home Depot on boosting sales from existing locations and investing in e-commerce, rather than opening new stores. Second-quarter revenue gained 5.7 percent to $23.8 billion, helped by improved weather and rising home prices that are spurring consumers to spend on renovations.

Aeropostale rose 8 percent to $3.50 after saying Thomas Johnson stepped down as CEO and as a director. Geiger served as Aeropostale’s CEO from 1996 to early 2010 and was the top executive at Crumbs Bake Shop Inc., the cupcake chain that shuttered its stores last month, from late 2011 through 2013.

Rackspace Hosting Inc. increased 2.9 percent to $32.75. Hedge fund Blue Harbour Group LP, which owns 6.4 percent of the cloud-computing provider, said in a statement that it looks forward to a discussion on alternatives, including a standalone entity, to deliver shareholder value.

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