US STOCKS-Wall St climbs as earnings offset poor housing data

                                

                                
 * Home Depot, Target profits top Wall St forecasts
                                
 * U.S. housing starts lower-than-expected in July
                                
 * Indexes up: Dow 0.7 pct, S&P 500 0.6 pct, Nasdaq 0.7 pct
                                
 * For up-to-the-minute market news click [STXNEWS/US]
                                
 (Updates to mid-morning)
                                
 By Edward Krudy
                                
 NEW YORK, Aug 18 (Reuters) - U.S. stocks rose  on Tuesday
after better-than-expected results from retailers Home Depot
Inc <HD.N> and Target Corp <TGT.N>  offset a surprise drop in
housing starts.
                                
 The rebound followed a sharp decline in global equity
markets the previous day when the S&P 500 index fell more than
2 percent.
                                
 U.S. housing starts and permits unexpectedly fell in July,
pulled down by steeper declines in multifamily units, a
government report showed, adding to concerns that the nascent
housing market recovery may be slow. For details,
see[ID:nN17348766]
                                
 But better-than-expected quarterly results for the two
large retailers helped boost stock indexes, in the latest
indication that U.S. corporations are weathering the economic
downturn.
                                
 Home Depot, the largest U.S. home improvement chain, beat
estimates and raised its outlook, while profit at Target, the
No. 2 U.S. retailer, came in better than Wall Street's
consensus forecast. [ID:nBNG461582] and [ID:nN14300199]. A
disappointing outlook from home improvement retailer Lowe's Cos
Inc <LOW.N> helped push equities to their worst loss in seven
weeks on Monday.
                                
 Home Depot shares rose 3.1 percent to $26.93 while Target
climbed 5.7 percent to $43.56. The S&P retail index <.RLX> rose
1.1 percent.
                                
 "We are seeing some tentative signs of improvement in the
market this morning, following yesterday's losses around the
world," said Michael Sheldon, chief market strategist at RDM
Financial in Westport, Connecticut.
                                
 But he added: "Today's housing start data does reinforce
the fact that any housing recovery that does take place is
likely to be limited in scope, at least over the near term."
                                
The Dow Jones industrial average <.DJI> was up 63.63 points,
or 0.70 percent, at 9,198.97. The Standard & Poor's 500 Index
<.SPX> was up 6.50 points, or 0.66 percent, at 986.23. The
Nasdaq Composite Index <.IXIC> was up 13.03 points, or 0.67
percent, at 1,943.87.
                                
 Smartphone makers Apple Inc <AAPL.O>, Research in Motion
Ltd <RIMM.O> and Palm Inc <PALM.O>, helped lift the Nasdaq
after RBC raised its price target on the shares, citing
compelling investment opportunities in the smartphone market.
[ID:nBNG257671]
                                
 After the market closes, Hewlett-Packard Co <HPQ.N> will
report quarterly earnings that could jolt technology portfolios
if there are signs of improved enterprise demand.
                                
 The broad S&P 500 index has rallied nearly 50 percent since
early March. The size of move has led many investors to expect
a significant pullback heading out of the summer months.
 (Reporting by Edward Krudy; Editing by Padraic Cassidy)