Weekly Economic Update for October 22, 2012

October 23, 2012  |   News

October 22, 2012

HOME SALES DECLINE, BUT HOUSING STARTS RISE 15%
The National Association of Realtors recorded a 1.7% decrease in existing home sales in September. Reduced inventory might have played a role. The amount of homes on the market fell to a 5.9-month supply, a low unseen since March 2006. The median home price was $183,900 in September, up 11.3% from a year ago; it hasn’t been so high since 2005. September’s 15.0% leap in homebuilding took housing starts to an annual rate of 872,000 units, the best pace since July 2008 and a 34.8% increase since September 2012.1,2

PUMP PRICES DRIVE UP CPI
Thanks largely to a 7% jump in gas prices, the federal government’s Consumer Price Index rose 0.6% in September. Still, the core CPI rose just 0.1% for the third straight month, and food prices rose only 0.1%. Annualized inflation came in at 2.0%.3

RETAIL SALES IMPROVE 1.1%
While the overall September gain announced by the Commerce Department was strong, the really notable number was the 0.9% rise in sales aside from gasoline, autos, and building materials. Electronics sales alone rose 4.5%.4

AFTER FRIDAY DIVE, STOCKS STILL LOG WEEKLY GAIN 
Thanks mostly to earnings disappointments, the 25th anniversary of Black Monday turned out to be a harsh day for Wall Street. The Dow sank 205.43 Friday, yet the week was mixed – S&P 500, +0.32% to 1,433.19; NASDAQ, -1.26% to 3,005.62; DJIA, +0.11% to 13,343.51. NYMEX crude settled at $90.05 Friday, down 1.97% for the week; COMEX gold settled at $1,724.00 Friday after a 2.03% weekly descent. That put oil down 8.88% YTD and gold up 10.03% YTD.1,5

THIS WEEK: Hasbro, Caterpillar, Yahoo!, Peabody Energy and Texas Instruments all offer Q3 results on Monday. Tuesday, earnings reports from DuPont, Amgen, 3M, Xerox, Netflix, Facebook and UPS arrive. Wednesday, the Census Bureau has numbers on September new home sales, the Fed wraps up a policy meeting, the August FHFA home price index appears and AT&T, Boeing, Akamai, Zynga, Symantec, Eli Lilly and Bristol-Myers all report earnings. On Thursday, we learn about September pending home sales and hard goods orders, new initial jobless claims number are out, and AstraZeneca, ConocoPhillips, P&G, Aetna, AutoNation, Credit Suisse, Dow Chemical, Pulte, Sprint, Apple, Altria, Amazon.com, and Coinstar issue Q3 results. Friday brings the first estimate of Q3 GDP, the final University of Michigan consumer sentiment survey for the month, and earnings from Merck and Comcast.

Sources: money.msn.com, bigcharts.com, treasury.gov, treasurydirect.gov – 10/19/121,6,7,8

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Citations.
1 – money.msn.com/market-news/post.aspx?post=8e931d01-f2df-44d5-b3e3-0b133a0ac6dd [10/19/12]
2 – www.inman.com/news/2012/10/17/housing-starts-82-percent-2009-trough [10/17/19]
3 – articles.latimes.com/2012/oct/17/business/la-fi-inflation-20121017 [10/17/12]
4 – www.reuters.com/article/2012/10/15/us-usa-economy-idUSBRE89E0RI20121015 [10/15/12]
5 – montoyaregistry.com/Financial-Market.aspx?financial-market=retirement-investment-funds&category=3 [10/19/12]
6 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=10%2F19%2F11&x=0&y=0 [10/19/12]
6 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=10%2F19%2F11&x=0&y=0 [10/19/12]
6 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=10%2F19%2F11&x=0&y=0 [10/19/12]
6 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=10%2F19%2F07&x=0&y=0 [10/19/12]
6 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=10%2F19%2F07&x=0&y=0 [10/19/12]
6 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=10%2F19%2F07&x=0&y=0 [10/19/12]
6 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=10%2F18%2F02&x=0&y=0 [10/19/12]
6 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=10%2F18%2F02&x=0&y=0 [10/19/12]
6 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=10%2F18%2F02&x=0&y=0 [10/19/12]
7 – treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyield [10/19/12]
7 – treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyieldAll [10/19/12]
8 – treasurydirect.gov/instit/annceresult/press/preanre/2002/ofm71002.pdf [7/10/02]

 

 

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