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By Lucia Mutikani

WASHINGTON, July 26 (Reuters) – Sales of just discovered U.S. single-family homes rebounded strongly in June from the antecedent month’s record low, pushing the number of houses on the place of traffic to the lowest level in nearly 42 years.

But downward revisions to sales estimates because of April and May contained in the report on Monday left in stead a picture of a weak housing market and perceptions that relating to housekeeping growth moderated somewhat in the second quarter.

New home sales vaulted 23.6 percent to a 330,000 unit annual rate, the Commerce Department reported. Still, the sales pace last month was the second lowest before this records started in 1963.

‘We can’t take too much delight in one month’s figure. The roadblocks to a healthy covering market are high, the most important one being the still-tall jobless rate,’ said Jennifer Lee, a senior economist at BMO Capital Markets in Toronto.

The percentage grow last month was the largest since May 1980, and it unfairly unwound May’s historic 36.7 percent drop. Analysts polled ~ means of Reuters had forecast new home sales rising to a 320,000 one pace last month from May’s previously reported 300,000 units.

The communicate, together with package delivery and business services company FedEx Corp’s upgrading of its quarterly and well stocked-year earnings forecasts, lifted stocks on Wall Street.

FedEx, regarded in the manner that an economic bellwether, said more packages were flowing through both its appearance and ground networks.

Prices for safe-haven U.S. government offence slipped, while the dollar pulled back from session lows against the yen.

Recent facts have implied the U.S. economy’s recovery from its longest and deepest recession as the 1930s slowed in recent months, but economists do not look for a renewed downturn.

Ford Motor Co Chief Executive Alan Mulally told NBC’s ‘Today’ manifest that he agreed. ‘I think that we’re going to acquire good, steady growth here,’ he said.

For a graphic on June sales of recently made known U.S. homes see:

http://link.reuters.com/fyt59m

ACTIVITY SLOWING DOWN

The ruling power is expected to report on Friday that growth slowed to a 2.5 percent recurring with the year rate in the April-June period from a 2.7 percent go at an ambling gait in the first three months of the year.

Moderation in improvement was signaled by a measure of national economic activity released without ceasing Monday. The Chicago Federal Reserve Bank said it’s national exercise index fell in June for the first time since February, dropping to negative 0.63 from a positive 0.31 in May. A prelection above zero indicates the economy is growing above trend.

Separately, a gauge of body of factors activity in the Texas region extended its decline this month, suggesting a twitch-back in manufacturing continued in July. Manufacturing has been the great sea engine of growth.

While economists expect weak housing activity to act similar to a drag on growth for much of the year, they do not believe this would be enough on its own to trigger a double-dip recession.

‘It’s not going to make a show of the economy that much. It’s more the economy affecting the protection market. What we need is for the economy to start creating jobs,’ before-mentioned Patrick Newport, an economist at IHS Global Insight in Lexington, Massachusetts.

Data highest week showed home construction fell to an eight-month low in June, time sales of existing home sales were the lowest in three months.

Housing’s portion of the economy has shrunk in recent years and residential formation accounted for about 2.4 percent of U.S. gross domestic product in the first quarter.

The impact of a 10 percent drop in home construction has about one-third the impact now because it did in 2006, according to economists at Bank of America-Merrill Lynch.

The Commerce narrate suggested the housing market may be close to working through the distortions following the period of a popular home-buyer tax credit in April, an cause that brought forward sales.

Last month’s surge in sales proverb the supply of new homes available for sale dropping to 7.6 months’ ~iness from 9.6 months’ worth in May. The number of unused homes on the market dropped 1.4 percent to 210,000 units, the lowest fit since September 1968.

‘Progress is being made in reducing the over-indulgence inventory, which is crucial for the outlook for prices,’ said Pale Dales, a U.S. economist at Capital Economics in Toronto.

‘However, strange home sales make up just five percent of all sales. And the express-tax credit fall-off in activity has yet to fully parade up in existing sales. Total home sales have, therefore, yet to apt expression rock bottom.’

The median sale price for a new home bring to the ground 1.4 percent last month to $213,400. In the 12 months to June, prices dipped 0.6 percent.

((lucia.mutikani@thomsonreuters.com; Tel: 202 898 8315; Reuters messaging: lucia.mutikani.reuters.com@reuters.gin)) Keywords: USA ECONOMY/

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