Markets little changed on lower home sales

Stocks began the day higher but lost steam. Dow is up 32, advancers ahead of decliners 4-3 while NAZ was flat. Banks also started higher, then lost ground. The 190 floor for the Financial Index is being tested.


S&P 500 FINANCIALS INDEX

Value 190.57

Change -0.36

% Change -0.2%

The Alerian MLP Index rose 1½ to the 295s, remaining near the 300 high it touched last week. The Dow Jones REIT Index fell change, hurt by news that Tishman Speyer Properties & BlackRock plan to cede control of Stuyvesant Town-Peter Cooper Village to lenders after the value of New York’s largest apartment complex plunged from their purchase price of $5.4B (they bought at the top of the market). Junk bond funds sold off from their high levels. The yield on the 10-year Treasury bond rose 2 basis points to 3.62%. The VIX, volatility index, shot up last week to 27, the highest level in 19 months. Traders were speculating that proposals to limit risk-taking by banks & signs China will rein in growth, will extend the S&P 500’s drop (after falling 5% in the last 3 days).


Alerian MLP Index --- 2 weeks




Dow Jones REIT Index --- 1 week




VIX --- 2 years










Oil is flat while gold is trying to reestablish 1100 as its floor.

CLH10.NYM

...Crude Oil Mar 10

...74.60

... 0.06 .......(0.1%)

GCF10.CMX

...Gold Jan 10

...1,100.40

.. 11.20 .......(1.0%)

Photo: AP


Sales of homes in Dec fell 16.7% to a 5.45M annual rate, from a pace of 6.54M in Nov (sales had been expected to fall 10%). This was the largest monthly drop in more than 40 years reflecting a sharp drop in demand after buyers stopped scrambling to qualify for a tax credit for first-time homeowners. The median sales price was $178K up 1.5% from a year earlier & the first yearly gain since Aug 2007. However, some of that increase could be due to a drop-off in purchases from first-time buyers who tend to buy less expensive homes. The sales rate is up 21% from the bottom a year ago, but down 25% from the peak more than 4 years ago. First-time buyers had been the main driver of the housing market, but their presence is on the decline. They accounted for 43% of sales in December, down sharply from Nov. The inventory of unsold homes on the market fell 7% to 3.3M. That's a 7.2 month supply at the current sales pace, close to a healthy level of about 6 months. Total sales for 2009 were 5.16M, up 5% from 2008, the first annual sales gain since 2005. But prices fell dramatically, declining 12.4% to a median of $173K, the largest decline since the Great Depression. Home sales are still stuck in the trenches.

•Existing U.S. Home Sales Decline More Than Estimated to 5.45 Million Pace


Sales rate for home - 1 year









Find out what's inside Trend TV Click Here


This is another day that there is not a lot happening in the markets. Fears about Bernanke not being reappointed to head the Federal Reserve have eased, sending the markets higher. But weak housing figures are weighing down stocks. More earnings are coming.

Dow Jones Industrials --- 2 weeks