Home Sales, Factory Orders Offer Encouraging Signs

By Jeff Bater

Word Count: 634

WASHINGTON -- New-home sales unexpectedly climbed during July, but economists expect lurking credit worries to cause further suffering in the housing sector.

A separate report Friday indicated strength in the manufacturing sector of the economy last month, just before the recent credit-market turmoil buffeted financial markets. Durable goods in July surged 5.9%.

Home sales in July defied expectations and stopped sliding. The Commerce Department reported demand for single-family homes increased by 2.8% to a seasonally adjusted annual rate of 870,000. Wall Street expected a 1.4% decline. The supply of unsold homes also receded, which is further good news, but inventories ...

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