Stocks fell for the fourth day in a row.
First, the scoreboard:
- Dow: 15,336.2, -65.1 -0.4%
- S&P 500: 1,697.4, -4.3, -0.2%
- NASDAQ: 3,768.2, +2.9, +0.0%
And now the top stories:
- We got some important information from the U.S. housing market today. First was the S&P/Case-Shiller home price index, which showed that average home prices climbed by 0.6% in July or 12.3% year-over-year. Thirteen cities saw prices rise month-over-month. “While the growth rate in house prices may slow in the coming months from the heady growth rates over the past year—the 3-month annualized change in home prices has decelerated to +10.0% from nearly +22.0% in April—house prices should continue to grow well above the rate of nominal GDP growth for at least the next year,” said Deutsche Bank’s Joseph LaVorgna.
- “Following the increase in mortgage rates beginning last May, applications for mortgages have dropped, suggesting that rising interest rates are affecting housing,” said S&P’s David Blitzer. “The Fed’s announcement last week that QE3 bond buying will continue for the time being may have only a limited, though favorable, impact on housing.”
- “We continue to see long-term fundamental demand in the market driven by the significant shortfall of new single-family and multi-family homes built over the last five years,” said Stuart Miller, CEO of homebuilder Lennar (LEN). “While there may be bumps along the road that may impact the short-term pace of the recovery, the long-term outlook for our business remains extremely bright.
- The Conference Board’s measure of consumer confidence fell to 79.7 in September from 81.8 in August. Economists were looking for a reading of 79.9. “Consumer Confidence decreased in September as concerns about the short-term outlook for both jobs and earnings resurfaced, while expectations for future business conditions were little changed,” said the Conference Board’s Lynn Franco. “Consumers’ assessment of current business and labor market conditions, however, was more positive. While overall economic conditions appear to have moderately improved, consumers are uncertain that the momentum can be sustained in the months ahead.”
- The Richmond Fed’s manufacturing activity index plunged to zero from last month’s reading of 14. Zero is a breakeven level. From the Richmond Fed: “Shipments, capacity utilization, and vendor lead time flattened, while the volume of new orders slowed. The backlog of new orders remained in decline. Finished goods inventories and raw materials inventories built up at about the same pace as in August. Manufacturing employment fell and the average work week shrank, while wage growth remained robust.”
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