Commenting on the existing home sales and today’s trading Gorilla Trades strategist Ken Berman said:
Q2 2020 hedge fund letters, conferences and more
The major indices are mixed and flat at midday, following another choppy morning session on Wall Street. While we got another batch of positive earnings reports, this time from the healthcare sector, the resurfacing trade worries have been holding back risk assets in early trading. In another sign of escalation between the U.S. and China, the State Department ordered the closure of the Chinese consulate in Houston, triggering an immediate backlash from the Asian giant. On a positive note, the Trump administration will reportedly buy 100 million doses of Pfizer’s (PFE) and BioNTech (BNTX) COVID vaccine for $2 billion, with an option for 500 million doses, should at least one of the firms’ vaccine variants pass the trials.
A Record Surge In Existing Home Sales
In economic news, existing home sales surged higher by the most on record, but the annualized 4.72 million units still missed the consensus estimate by a hair. The Housing Price Index missed expectations as well, falling by -0.3%, and last month’s reading was also revised lower. Crude oil inventories rose unexpectedly by 4.9 million barrels, and energy-related issues gave back some of their gains from yesterday, with U.S.-China tensions also weighing on the sector.
Market Wrap
Dow: 26,918, + 78 or 0.3%
S&P 500: 3,262, + 4 or 0.1%
Nasdaq: 10,672, – 9 or 0.1%
Russell 2000: 1,489, + 1 or 0.1%
Market breadth has been a bit weak this morning, with decliners outnumbering advancing issues decliners by a 5-to-4 ratio on the NYSE at midday. Only 7 stocks hit new 52-week lows on the NYSE and the Nasdaq, while 123 stocks hit new 52-week highs. The major indices have been hovering around their daily VWAPs (Volume-Weighted Average Price) throughout the morning session, pointing to a choppy and mixed afternoon. Real estate stocks bounced back hard this morning thanks to the existing home sales data, but most of the key sectors were relatively quiet, with only industrial showing notable strength and energy stocks lagging the major indices. Stay tuned!
