Hump day data roundup: Housing starts, mortgages industrial output
Nasdaq slides >2%, S&P 500 falls >1%, Dow rises modestly
Real Est leads S&P 500 sector gainers; Tech weakest group
Euro STOXX 600 index off ~0.3%
Dollar, gold dip; bitcoin gains; crude rallies ~2%
U.S. 10-Year Treasury yield edges up to ~4.18%
Welcome to the home for real-time coverage of markets brought to you by Reuters reporters. You can share your thoughts with us at markets.research@thomsonreuters.com
HUMP DAY DATA ROUNDUP: HOUSING STARTS, MORTGAGES, INDUSTRIAL OUTPUT
If recent data has painted a picture of a U.S. economy capable of pulling off a safe landing, indicators released early Wednesday added a few dabs of color to that canvas.
Groundbreaking on new U.S. homes USHST=ECI increased by 3.0% last month to 1.353 million units at a seasonally adjusted annualized rate (SAAR).
This number stands on the shoulders of May's 2.9% upward revision.
Consensus called for a 1.8% increase from the unrevised number.
Elsewhere in the Commerce Department's report, building permits USBPE=ECI - considered among the more forward-looking housing market indicators - also defied the expectation by rising 3.4% in June to 1.446 million units SAAR.
Scratching below the surface, multiple-unit projects were responsible for the gains in starts and permits, offsetting a dip in single family units.
"Builders are pulling back on single family projects as they anticipate the broader economic slowdown," says Jeffrey Roach, chief economist at LPL Financial. "Elevated mortgage rates continue to weigh on prospective buyers but demand for condos seems to be quite resilient."
"We could expect a modest rebound in single family projects if the Fed cuts and mortgage rates fall," Roach adds.
Speaking of the devil, mortgage rates dipped last week, prompting a surge in refi demand, according to the Mortgage Bankers Association (MBA).
The average 30-year fixed contract rate USMG=ECI shed 13 basis points to 6.87%, its lowest level since March.
But that failed to impress would-be home buyers. Demand for loans to purchase homes USMGPI=ECI dropped 2.7%.
But applications to refinance existing mortgages USMGR=ECI jumped 15.2%, resulting in a net overall mortgage demand increase of 3.9%.
"Recent signs of cooling inflation and the increased likelihood of Fed rate cuts later this year pulled (mortgage rates) lower," says Joel Kan, MBA's deputy chief economist, who notes that refi activity last week touched its highest level since August 2022.
With this report, the 30-year contract rate has returned to where it was a year ago.
Over the same time period, refi activity is up 37.3%, while purchase applications - also viewed as a forward housing indicator - have dropped 14.0%.
Switching gears, a report from the Federal Reserve showed industrial output USIP=ECI increased by 0.6% in June, double the pace analysts expected.
Year-over-year, production is up 1.6% - a significant acceleration from May's 0.3% annual rate.
Drilling down, utilities' output increased by 2.8% while auto production grew 1.6%, handily offsetting declines in business equipment and construction supplies.
Capacity utilization USCAPU=ECI, a measure of economic slack, unexpectedly tightened, rising 50 basis points to 78.8%, the highest rate since last September.
"This is a little contrary to the ISM manufacturing data, which has shown contraction," writes Scott Helfstein, head of investment strategy at Global X ETFs. "Perhaps the economy is still better than people think."
"U.S. economic data continues to signal all clear," Helfstein adds. "There is real investment driving real productivity gains across the economy."
(Stephen Culp)
*****
FOR WEDNESDAY'S EARLIER LIVE MARKETS POSTS:
S&P, NASDAQ DOWN AS CHIP, TECH STOCKS LEAD DECLINES - CLICK HERE
POWER STRUGGLE WITHIN THE NASDAQ COMPOSITE ABOUT TO COME TO A HEAD? - CLICK HERE
CURVE STEEPENERS COULD BE THE TRUMP TREASURY TRADE - CLICK HERE
CONSIDER OWNING OPTIONS BEFORE EARNINGS - BARCLAYS - CLICK HERE
TRUMP TARIFFS COULD WIPE OUT EUROPE'S 2025 EPS GROWTH, GS FINDS - CLICK HERE
BANK OF ENGLAND'S CRUEL SUMMER - CLICK HERE
DRUGS AND CHIPS DRIVE THE STOXX - CLICK HERE
LET THE CHIPS FALL WHERE THEY MAY - CLICK HERE
GOLD GLITTERS, INFLATION JITTERS - CLICK HERE
Housing starts and building permits https://reut.rs/3xZiESO
Industrial production https://reut.rs/4f8fi0w
Mga Kaugnay na Asset
Pinakabagong Balita
Disclaimer: Ang mga kabilang sa XM Group ay nagbibigay lang ng serbisyo sa pagpapatupad at pag-access sa aming Online Trading Facility, kung saan pinapahintulutan nito ang pagtingin at/o paggamit sa nilalaman na makikita sa website o sa pamamagitan nito, at walang layuning palitan o palawigin ito, at hindi din ito papalitan o papalawigin. Ang naturang pag-access at paggamit ay palaging alinsunod sa: (i) Mga Tuntunin at Kundisyon; (ii) Mga Babala sa Risk; at (iii) Kabuuang Disclaimer. Kaya naman ang naturang nilalaman ay ituturing na pangkalahatang impormasyon lamang. Mangyaring isaalang-alang na ang mga nilalaman ng aming Online Trading Facility ay hindi paglikom, o alok, para magsagawa ng anumang transaksyon sa mga pinansyal na market. Ang pag-trade sa alinmang pinansyal na market ay nagtataglay ng mataas na lebel ng risk sa iyong kapital.
Lahat ng materyales na nakalathala sa aming Online Trading Facility ay nakalaan para sa layuning edukasyonal/pang-impormasyon lamang at hindi naglalaman – at hindi dapat ituring bilang naglalaman – ng payo at rekomendasyon na pangpinansyal, tungkol sa buwis sa pag-i-invest, o pang-trade, o tala ng aming presyo sa pag-trade, o alok para sa, o paglikom ng, transaksyon sa alinmang pinansyal na instrument o hindi ginustong pinansyal na promosyon.
Sa anumang nilalaman na galing sa ikatlong partido, pati na ang mga nilalaman na inihanda ng XM, ang mga naturang opinyon, balita, pananaliksik, pag-analisa, presyo, ibang impormasyon o link sa ibang mga site na makikita sa website na ito ay ibibigay tulad ng nandoon, bilang pangkalahatang komentaryo sa market at hindi ito nagtataglay ng payo sa pag-i-invest. Kung ang alinmang nilalaman nito ay itinuring bilang pananaliksik sa pag-i-invest, kailangan mong isaalang-alang at tanggapin na hindi ito inilaan at inihanda alinsunod sa mga legal na pangangailangan na idinisenyo para maisulong ang pagsasarili ng pananaliksik sa pag-i-invest, at dahil dito ituturing ito na komunikasyon sa marketing sa ilalim ng mga kaugnay na batas at regulasyon. Mangyaring siguruhin na nabasa at naintindihan mo ang aming Notipikasyon sa Hindi Independyenteng Pananaliksik sa Pag-i-invest at Babala sa Risk na may kinalaman sa impormasyong nakalagay sa itaas, na maa-access dito.
