Wednesday, August 29, 2012

July Pending Home Sales Up 2.4%

As we suggested yesterday, July pending home sales surprised to the upside.  The monthly change came in at 2.4%, significantly above the no change consensus.  We note that the 2.4% figure is seasonally adjusted.  In addition, while the Y/Y change was positive for all regions, the West experienced a slight m/m decline, -1.7%.  The NAR blames this on limited inventory.  The non-seasonally adjusted numbers were a different story as three of the four regions saw a m/m decline, with Northeast 'leading the way' with -20.6%.  However, similar to the seasonally adjusted figures, there was a Y/Y increase in pending home sales within every region.  XHB is up 0.6% but hasn't yet gone above its 52-week high of 23.59. 
Overall, the market is pretty much flat with S&P 500 up one point.  It appears that the GDP and pending home sales numbers were too good, which means it is less likely for the Fed to launch a QE this year or even give the market some hint on Friday at the Jackson Hole meeting.

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