Midday Update: Weak Housing Market Data Dampens Post-FOMC Euphoria

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With the Federal Reserve finally beginning to taper its stimulus programs, the financial markets are turning attention to other influences today. Equities are fractionally lower in very light profit-taking, exacerbated by bearish economic data and pulling the three major indices off yesterday's post-FOMC highs.

Razor-thin ranges are also being established as the Christmas holiday winds down with few traders stepping too far from the pack ahead of Q3 GDP due out tomorrow. The tech-heavy Nasdaq is underperforming with bio-tech stocks taking the brunt of the selling pressure, while the Dow Industrials Average is being weighed down by weakness in industrials as well as the interest-rate sensitive utility sector.

The job market appeared slightly worrisome during the week ended Dec. 14, with first-time unemployment claims rising to their highest level in nine months, increasing 10,000 to 379,000 new claims, well above consensus estimates expecting a 32,000 decline last week.

The Philadelphia business conditions index showed small improvement from November, although the 7.0 reading likewise trailed expectations for a 10.0 reading. Leading indicators improved 0.8% in November, narrowly exceeding market estimates for a 0.7% gain.

But it was the surprising decline in existing home sales that caught the market's attention, falling 4.3% in November to an annual pace of 4.9 million - the slowest pace for home sales in nearly a year. It was the third consecutive month of weaker home sales, underscoring the detrimental impact higher Treasury yields and higher mortgage rates are having on the housing market.

Europe capitalized on yesterday's gains in the U.S. and closed higher across the board as Investors shrugged of weak UK retail sales took advantage of cheaper prices after recent declines in European bourses.

Crude oil was up $0.85 to $98.65 per barrel. Natural gas was up $0.17 to $4.43 per 1 million BTU. Gold was down $36.10 to $1,198.90 an ounce, while silver was down $0.88 to $19.18 an ounce. Copper was down $0.03 to $3.29 per pound.

Among energy ETFs, the United States Oil Fund was up 1.11% to $35.42 with the United States Natural Gas Fund was up 4.07% to $21.76. Amongst precious-metal funds, the Market Vectors Gold Miners ETF was down 1.61% to 20.59 while SPDR Gold Shares was down 1.60% to $115.71. The iShares Silver Trust was down 2.88% to $18.54.

Here's where the markets stand at mid-day:

NYSE Composite Index down 18.39 (-0.18%) to 10,135.81

Dow Jones Industrial Average up 3.53 (+0.02%) to 16,171.50

S&P 500 down 2.48 (-0.14%) to 1,808.17

Nasdaq Composite Index down 12.66 (-0.31%) to 4,057.40

GLOBAL SENTIMENT

Nikkei 225 Index up 1.74%

Hang Seng Index down 1.10%

Shanghai China Composite Index down 0.95%

FTSE 100 Index up 1.43%

CAC 40 up 1.64%

DAX up 1.68%

NYSE SECTOR INDICES

NYSE Energy Sector Index up 0.04%

NYSE Financial Sector Index down 0.22%

NYSE Healthcare Sector Index down 0.13%

UPSIDE MOVERS

(+) CHTP (+3.48%) JMP initiated coverage of the stock at Outperform and an $8 price target.

(+) OXBT (+36.15%) The company expects its 2014 milestones to include enrollment in a Phase 3 trial for levosimendan, and completion of Army-funded preclinical safety studies for Oxycyte.

(+) ACN (+4.38%) Reported Q1 EPS of $1.15, vs. the analyst consensus of $1.10 per share. Revenue was $7.4 bln, vs. expectations of $7.24 bln.

DOWNSIDE MOVERS

(-) TSLA (-5.14%) Ohio car dealers are suing Tesla, saying that its sales model is in violation of state law.

(-) WGO (-10.21%) Net revenue climbed 15% to $222.7 million, but missed the mean estimate of two analysts for $226 million, according to Capital IQ.

(-) SMTC (-13.50%) Downgraded by four analyst firms after issuing weak outlook for earnings during the three months ending Jan. 26, 2014.



The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.

Copyright (C) 2014 MTNewswires.com. All rights reserved. Unauthorized reproduction is strictly prohibited.


This article appears in: Investing , Commodities

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