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US Stocks Surge to Highest Level of Year on Housing News

The benchmark Dow Jones industrial average of the top US companies broke the 9,000 point mark Thursday on strong earnings reports and an improving housing picture.

Wall Street extended its recent gains Thursday after a new housing report showed sales of previously owned U.S. homes rose at an annual pace of 3.6 percent in June. It was the third straight month of rising home sales.

"The markets are reacting to the news today in the context of other things they've been seeing and reading in recent weeks, and that's that the economy does appear to have hit a bottom," said David Resler, chief economist at Nomura Securities.

Investors reacted positively to earnings reports from Ford, Ebay, AT&T and higher sales of Apple's new iPhone. Resler says the positive earnings give a much needed confidence boost for the struggling U.S. economy. "I think that were near an important turning point in this economic cycle and things are looking up from here." Resler said.

The Ford Motor Company posted a 2.3 billion dollar profit in the second quarter and says it expects to break even in 2011. The automaker is doing better than rivals General Motors and Chrysler mainly due to its debt restructuring. Ebay's profit picture also shows consumers may be ready to shop online again.