Summary:
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US benchmarks trading higher ahead of cash session
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S&P500 set for 3rd consecutive weekly decline
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Housing starts drop again
It’s been a bit of a wild rise for US stock markets this week with several large and sharp moves caused by the latest developments on the trade front. As the dust settles the S&P500 remains on course to post a 3rd consecutive weekly decline, but the trading range is inside the previous weekly candle. The major US indices are trading higher by between 0.5-1.0% at the time of writing.
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The S&P500 has moved back up to the Ichimoku cloud on H1 with the market trading around 25 points higher than where it was on last night’s closing bell. Source: xStation
Some 2nd tier data is out this afternoon with the latest housing figures just released and Uni Mich consumer sentiment due at 3PM (BST). In July, US homebuilding fell for the third month in a row due in part to a steep decline in the construction of multi-family units. Housing starts came in at 1.19M vs 1.26M expected, with the prior reading now standing at 1.24M after being revised down from 1.25M.
The housing market has not benefited much from declining mortgage rates because of land and labor shortages, which are constraining builders’ ability to construct sought-after lower-priced homes. That has left the housing market continuing to grapple with tight inventory and sluggish sales growth. The 30-year fixed mortgage rate has dropped to 3.60% from a peak of 4.94% in November, according to data from mortgage finance agency Freddie Mac. There was better news from the building permits figures, which came in at 1.34M - above the expected 1.27M and also the highest reading since the March release. The prior reading of 1.23M was revised higher from 1.22M.
Building permits in the US moved up to their highest level in 8 months but this rise has not yet been replicated in the number of housing starts. Source: Bloomberg
