Tuesday’s Mid-Day Movers: 3 Stories Driving Markets
The U.S. equity markets overcame early losses and are showing resilience in the face of some mixed economic signals. At the end of the day, higher-than-expected earnings are pulling the markets to five-year highs.
At: 1:00 p.m.: DJIA: +0.46%, S&P 500: +0.36%, NASDAQ: -0.07%.
1) Home prices rose 5.5 percent through November for the S&P/Case-Shiller 20-City Composite Index, according to data released today. Prices climbed 4.5 percent for the 10-City Composite Index.
“The November monthly figures were stronger than October, with 10 cities seeing rising prices versus seven the month before,” commented David Blitzer, chairman of the Index Committee. “Winter is usually a weak period for housing which explains why we now see about half the cities with falling month-to-month prices compare to 20 out of 20 seeing rising prices last summer. The better annual price changes also point to seasonal weakness rather than a reversal in the housing market.”
2) The ICSC-Goldman Retail Chain Stores Index fell 1 percent week over week for the seven-day period ended January 26, the fourth consecutive period of declines. Year over year, store sales grew 2 percent, 1.2 points shy of the 3.2 percent growth rate trend that was established heading into the reading. Similarly, the Redbook report shows year-over-year retail growth of just 1.6 percent for the week ended January 26, compared to 1.8 percent average growth for December.
Consumer spending accounts for as much as 70 percent of economic activity, and patterns of consumer behavior are like economic trade winds that investors can use to plot a course through the markets. Although it’s still too early to tell, some economists are blaming the payroll tax increase on the sales slump.
3) Despite a delay in the fiscal cliff, consumer confidence in the United States took another plunge in January to reach its lowest level in more than a year.
After a sharp decline in December, the Conference Board Consumer Confidence Index fell further in January. The index of consumer attitudes dropped to 58.6, compared to an upwardly revised 66.7 last month. It was the lowest reading since November 2011 and the worst month-over-month decline since August 2011, when Washington D.C. caused pessimism with its bickering over the debt ceiling… (Read more.)