New home sales inch up, driven by apartment surge: Midday roundup

New home sales inched up for the third straight month in June, according to the Housing Industry Association’s new home sales report.

The report showed a 2.8% rise in new home sales, driven by a 15.7% surge in apartments and townhouses. In May, new home sales rose 0.7%.

“But all the action has been in the multi-unit sector,” said HIA chief economist Harley Dale.

“It is, however, a stark reminder of how much catching up is left in the multi-unit sector when a lift of this magnitude still leaves sales volumes 36% below their 10-year average.”

Stamp duty concessions in the first half of the year in NSW drove a 30.8% increase in apartments and units in that time.

“Detached housing, which still accounts for 70% of new housing starts in Australia, was disappointing,” said Dale.

Standalone house sales rose by 0.7% in June, following a 2% drop in May, the HIA said.

Sharemarket rises

The Australian stock market rose at opening after Germany and Italy echoed European Central Bank president Mario Draghi’s vow to do everything necessary to save the beleaguered eurozone.

At the official market open, the benchmark S&P/ASX 200 index rose 0.83% to 4244.7 points and the broader All Ordinaries Index grew 0.77% to 4266.9 points.

Ric Spooner, chief market analyst at CMC Markets, said the S&P/ASX 200 index is today likely to test the upper boundary of a zone of technical resistance between about 4205 and 4250.

“This resistance is formed by the 200 day moving average, which is currently at around 4206; an upward sloping resistance line which currently intersects at around 4230 and the early April lows at around 4246.”

Ford tipped to exit Australia

Car-maker Ford may quit local production by 2016, according to a report in The Australian Financial Review.

Stephen Longley, partner with PPB Advisory, told the paper Ford was likely to exit as a local manufacturer.

“It’s the elephant in the room, it’s just not talked about openly,” he said.

The speculation follows Ford’s recent announcement it would cut 440 jobs.

Dollar at four-month high

The Australian dollar hit a four-month high this morning, after the leaders of Germany and Italy pledged to protect the eurozone from the debt crisis.

At 11.50am, the local unit was trading at US104.63 cents, up from 104.26 cents on Friday.

Earlier, the currency peaked at US104.97 cents, its highest level in four months.