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Pending Homes Sales Expected to See 5th Monthly Gain

by devteam August 4th, 2009 | Share

 

With the S&P 500 improving 1.5% yesterday, Sal Guatieri from BMO Capital Markets noted that the index has seen its best five-month performance since 1938. The benchmark index crossed the 1,000 mark yesterday for the first time since November, but today futures are pulling it back down to 993, as sentiment is lower with the Zurich-based bank UBS reporting that losses were extended in the second quarter.

Two major bits of data are released this morning. Guatieri calls the first, personal income & outlays, anti-climatic, as the June figures were already reported in Q2 GDP last Friday.

“We already know that real consumer spending contracted 1.2% annualized in Q2, which likely flags a 0.3% drop in June (though revisions may say otherwise),” he said in a client note. “Personal income probably dropped 1.0% due to steep job losses, while the savings rate could slide to 4.6% from (a likely downwardly-revised) 6.9% in May.”

In addition to spending and income figures, the report also features the Fed’s preferred measure of inflation, called the core PCE deflator. It is expected to rise 0.2% in the month, putting the annual rate at +1.7%, three-tenths below the ideal rate.

Half an hour into the trading session markets will look at the pending home sales index, which is widely expected to advance for the fifth straight month.

Guatieri adds: “They have surged 44% annualized in the previous four months, suggesting the housing market has finally turned the corner.”

More Details on Today’s Key Releases:

8:30 â€

About the Author

devteam

Steven A Feinberg (@CPAsteve) of Appletree Business Services LLC, is a PASBA member accountant located in Londonderry, New Hampshire.

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