Builder sentiment improves to least cranky level since April
Nasdaq up ~0.8%, S&P 500 gains, Dow ~flat
Cons disc leads S&P sector gainers; Healthcare weakest group
Euro STOXX 600 index off ~0.2%
Dollar dips; gold up ~2%; crude up >2.5%; bitcoin now up >3.5%
U.S. 10-Year Treasury yield rises to ~4.46%
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BUILDER SENTIMENT IMPROVES TO LEAST CRANKY LEVEL SINCE APRIL
At the top of a busy week of housing data, homebuilders got the ball rolling by cheering up a tad.
Or more accurately, The National Association of Home Builders' (NAHB) latest Housing Market index USNAHB=ECI is a bit less grumpy, delivering an unexpected three-point gain to 46, it's highest reading since April but still below 50, and therefore still in "pessimist" territory.
Consensus called for the index to stand pat at 43.
"While builder confidence is improving, the industry still faces many headwinds such as an ongoing shortage of labor and buildable lots along with elevated building material prices," writes NAHB chief economist Robert Dietz. "Moreover, while the stock market cheered the election result, the bond market has concerns, as indicated by a rise for long-term interest rates."
That very rise in Treasury yields has helped push the average 30-year fixed mortgage rate higher, pressuring affordability.
Even so, the still-tight supply of homes on the market should continue to provide some support for new builds.
There's more housing data on tap this week.
On Tuesday, the Commerce Department releases its October report on housing starts, expected to fall 1.8% and building permits, seen edging up 0.4%.
Wednesday and Thursday bring weekly data from the Mortgage Bankers Association and October sales of existing homes courtesy of the National Association of Realtors.
The housing market, the has-been star of the pandemic which benefited from a stampede for the suburbs in search of social distancing and home office space, has since fallen into a funk.
Supply constraints and tighter financial conditions have sent prices and mortgage rates higher, moving the prospect of home ownership beyond the grasp of many potential buyers, particularly at the lower end of the market.
Finally, let's take a look at the stock market, which reflects where investors expect the sector to be six months to a year down the road.
For the last 12 months, the S&P 1500 Homebuilding index .SPCOMHOME and the Philadelphia SE Housing index .HGX have handily outperformed the broader S&P 500 .SPX.
That healthy lead has narrowed in recent weeks.
The SPCOMHOME and HGX are have gained 37.1% and 35.7%, respectively over the last year, only slightly better than the SPX's 30.1% advance over the same time period:
(Stephen Culp)
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FOR MONDAY'S EARLIER LIVE MARKETS POSTS:
U.S. STOCKS CHURN, AWAIT NVIDIA, RETAIL EARNINGS - CLICK HERE
BENCHMARK TREASURY YIELD REMAINS ON A RUN - CLICK HERE
SHELL, BESI, ASTRAZENECA IN BARCLAYS' 14 HIGH CONVICTION EUROPEAN STOCK IDEAS - CLICK HERE
EUROPE'S U.S. LOCAL GOODS EXPOSURE COULD HELP OFFSET TARIFFS - CLICK HERE
WILL AMERICA MAKE LUXURY GREAT AGAIN? - CLICK HERE
STOXX WAVERS AROUND PARITY - CLICK HERE
EUROPE BEFORE THE BELL: QUIET START TO THE WEEK - CLICK HERE
BOJ OPEN TO TIGHTENING, MUM ON TIMING - CLICK HERE
Housing dashboard https://reut.rs/4fJBVIg
Housing stocks https://reut.rs/3ZfteQw
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