Builder optimisms bounces in May after 4 month slide

U.S. homebuilders are feeling more confident about their sales prospects, reflecting strong demand for newly built homes with existing homes in short supply.

The National Association of Home Builders/Wells Fargo builder sentiment index released Tuesday rose two points to 70 this month. That's up from a revised reading of 68 in April.

That ends a four-month slide for builders.

Any reading above 50 indicates more builders see sales conditions as good rather than poor. The index has remained above 60 since September 2016.

May's index exceeded expectations for a reading of 69, according to FactSet.

Builders' view of current sales conditions rose two points to 76 this month. The outlook for sales over the next six months held at 77. A measure of buyer traffic held steady at 51.