A little profit-taking last week didn’t come as a big surprise, particularly in light of rekindled trade war fears. Though nobody really thinks geopolitical tensions will snowball into a global recession, that was the rhetoric-of-the-day for a couple of days last week. As has been the case several times in recent weeks, however, traders were mostly expecting a lull, followed by a move to even higher highs.
The market, however, didn’t exactly finish last week on a high note. On Thursday the market was up-ended, and pulled back under a relatively meaningful support line. It tried to recover on Friday, and it did to a modest degree. When push came to shove later in the day though, the bulls weren’t biting. We may get the June swoon yet.
We’ll weigh it all below, as always, after a run-down of last week’s and this week’s economic announcements.
Economic Data
Not a very busy week last week, though it was a big one for the real estate market. Aside from a couple of home-price index updates, we got a look at last month’s housing starts and building permits reports. Both were pretty good, with starts rolling in better than expected. Though neither is moving higher in a straight line, both are moving higher, yet neither has reached the pre-2007 breakneck pace that wound up being unsustainable.
Housing Starts and Building Permits Charts
Source: Thomson Reuters
Though we won’t get May’s new-home sales numbers until this week, if they’re anything likes last month’s existing home sales data, there’s a lot to look forward to…sort of. Existing homes were sold at an annualized clip of 5.43 million. That pace is slowing, and though limited inventory might be contributing to the problem, a lack of inventory has been less of a problem the last couple of months.
Home Sales and Inventory Charts
Source: Thomson Reuters
