Tuesday, March 19th, 2024
Pre-market futures are in the red again currently, pointing at this early stage in the day’s trading toward the third down-session in the past four on the S&P 500 — which, importantly have come off all-time highs mid-last week. The Dow is -91 points right now, while the S&P is -28 and the Nasdaq -145 points. On the tech-heavy Nasdaq side, this looks like a bit of a give-back from yesterday’s outperformance relative to the other major indices.
That said, in the minutes following the Housing Starts results for February out this morning, these losses look to be pared somewhat. If you can recall back to a month ago, new housing starts fell back to their lowest levels in four months, to 1.33 million seasonally adjusted, annualized units in January. This morning, 1.521 million units easily surpassed the expected 1.425 million. Weather-related issues the previous month appear to have been worked through to a certain extent.
Building Permits — a proxy for future starts — also outpaced expectations: 1.518 million versus 1.495 million in the consensus estimate. This is the highest monthly print we’ve seen since August of last year. Revisions for January moved up from 1.47 million to 1.49 million. Obviously, permits are not weather-permitting; as such, they may be an even cleaner response to mortgage rates, which had surmounted 7% levels and threatened to go higher (although they have returned more recently).
Breaking down these housing numbers a bit, single-family units in February amounted to 1.1 million, +12% month over month and +35% year over year. This segment continues to be historically under-supplied, especially relative to multi-family housing, which grew +392K last month. In terms of region, the Northeast and West moved down in February, while the Midwest and South gained. Strong demand continues to be the overall narrative pulling this market forward.
Going back to mortgage rates a moment, while they have drifted back up to the 7% range, expectations are for lower interest rates from the Fed at some point this year (currently penciled-in for June, but we will find out much more once the FOMC meeting tomorrow ends with a new interest-rate dot-plot and press conference from Fed Chair Jerome Powell). This has been a harbinger of sorts for housing, supported by continued demand, as mentioned above. More overall good news for the economy.
So then, pre-market futures, while still in the negative, have pushed up noticeably in just the short time it’s taken me to write this column. The Dow is now -35 points, the S&P is -17, the Nasdaq -101 and the small-cap Russell 2000 -13 points. Even with the Russell hitting the skids a bit of late, all four major indices are up for the past month and year to date. We’ll see if the bullish appetite will bid up the market ahead of the Fed’s decision tomorrow to not make a move on interest rates.
Questions or comments about this article and/or author? Click here>>
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Housing Market Data Shows Bounce-Back in February
Tuesday, March 19th, 2024
Pre-market futures are in the red again currently, pointing at this early stage in the day’s trading toward the third down-session in the past four on the S&P 500 — which, importantly have come off all-time highs mid-last week. The Dow is -91 points right now, while the S&P is -28 and the Nasdaq -145 points. On the tech-heavy Nasdaq side, this looks like a bit of a give-back from yesterday’s outperformance relative to the other major indices.
That said, in the minutes following the Housing Starts results for February out this morning, these losses look to be pared somewhat. If you can recall back to a month ago, new housing starts fell back to their lowest levels in four months, to 1.33 million seasonally adjusted, annualized units in January. This morning, 1.521 million units easily surpassed the expected 1.425 million. Weather-related issues the previous month appear to have been worked through to a certain extent.
Building Permits — a proxy for future starts — also outpaced expectations: 1.518 million versus 1.495 million in the consensus estimate. This is the highest monthly print we’ve seen since August of last year. Revisions for January moved up from 1.47 million to 1.49 million. Obviously, permits are not weather-permitting; as such, they may be an even cleaner response to mortgage rates, which had surmounted 7% levels and threatened to go higher (although they have returned more recently).
Breaking down these housing numbers a bit, single-family units in February amounted to 1.1 million, +12% month over month and +35% year over year. This segment continues to be historically under-supplied, especially relative to multi-family housing, which grew +392K last month. In terms of region, the Northeast and West moved down in February, while the Midwest and South gained. Strong demand continues to be the overall narrative pulling this market forward.
Going back to mortgage rates a moment, while they have drifted back up to the 7% range, expectations are for lower interest rates from the Fed at some point this year (currently penciled-in for June, but we will find out much more once the FOMC meeting tomorrow ends with a new interest-rate dot-plot and press conference from Fed Chair Jerome Powell). This has been a harbinger of sorts for housing, supported by continued demand, as mentioned above. More overall good news for the economy.
So then, pre-market futures, while still in the negative, have pushed up noticeably in just the short time it’s taken me to write this column. The Dow is now -35 points, the S&P is -17, the Nasdaq -101 and the small-cap Russell 2000 -13 points. Even with the Russell hitting the skids a bit of late, all four major indices are up for the past month and year to date. We’ll see if the bullish appetite will bid up the market ahead of the Fed’s decision tomorrow to not make a move on interest rates.
Questions or comments about this article and/or author? Click here>>