Up on confidence rise despite horrid home sales data
Small-cap stocks pushed higher on the opening, maintaining an early gain on a jump in consumer confidence that helped counter absolutely dreadful reports on the housing market. At 10:04 a.m. ET, the Russell 2000 (NYSE:IWM) was up 4.04, or 0.85%, at 479.12.
The new home sales report came in at an annualized rate of 407,000 units, which was below the forecast for 415,000. But the truly scary news came from the existing home sales data, which showed sales at an annual rate of 4.49 million units, way off the 4.93 million forecast. The pace of home sales plunged a record 8.6% in November and the median home price dropped to $181,300, which was a 13.2% annual decline, the largest since records have been kept over the past 40 years.
Despite the gloomy home news, consumer confidence as seen in the Michigan sentiment survey rose to 60.1, which was better than the forecast of 58.6, and which helped counter the horrendous home sales report. Earlier this morning, the GDP report came in at minus 0.5%, which was in line with expectations. The GDP data marked the final revision for the third quarter and reflected the sharpest decline in GDP from the previous quarter since Q3 2001 right after the 9/11 attacks.
In overnight trading, European shares were slightly firm, but Asia stocks took a hit, with car makers still in the spotlight. As for U.S. automakers, credit ratings for both General Motors Corp. (NYSE:GM) and Ford Motor Co. (NYSE:F) were slashed. Shortly after the open, GM was down 11%, while Ford was down 12%. Both automaker stocks . . .
The new home sales report came in at an annualized rate of 407,000 units, which was below the forecast for 415,000. But the truly scary news came from the existing home sales data, which showed sales at an annual rate of 4.49 million units, way off the 4.93 million forecast. The pace of home sales plunged a record 8.6% in November and the median home price dropped to $181,300, which was a 13.2% annual decline, the largest since records have been kept over the past 40 years.
Despite the gloomy home news, consumer confidence as seen in the Michigan sentiment survey rose to 60.1, which was better than the forecast of 58.6, and which helped counter the horrendous home sales report. Earlier this morning, the GDP report came in at minus 0.5%, which was in line with expectations. The GDP data marked the final revision for the third quarter and reflected the sharpest decline in GDP from the previous quarter since Q3 2001 right after the 9/11 attacks.
In overnight trading, European shares were slightly firm, but Asia stocks took a hit, with car makers still in the spotlight. As for U.S. automakers, credit ratings for both General Motors Corp. (NYSE:GM) and Ford Motor Co. (NYSE:F) were slashed. Shortly after the open, GM was down 11%, while Ford was down 12%. Both automaker stocks . . .
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