The S&P 500 slipped by 0.7% on Tuesday, ending a five-session continuous winning streak. The recent retail sales report disappointed and caused concern amongst investors. Retail sales declined by 1.1% in July vs the 0.3% expected. The slow down in sales of Home Depot and Target, compared to last year, is justification that the economic growth is slowing down. S&P 500 to it’s lowest in a month.
All eyes are on the Fed’s FOMC minutes to be released later on Wednesday. Everyone is eagerly awaiting the Fed’s announcement to start tapering assets. This has been a pressing concern in investors’ minds as it has a significant impact on the markets.
However, most experts remained positive amidst the uncertainty of the monetary policy changes and added to that the Delta variant threats.
This second half of the year is considered the weaker part; therefore, investors are waiting for a trigger to start the sell-off. But overall economic data and earnings reports show a good reason to
New home building is also down
Material and labour shortages affected the housing market, and new home buildings dropped more than expected. The Commerce Department announced Housing starts has fallen by 7%, which is the worst since April.
However, housing starts increased by 3.5% in June, and single-family homes declined by 4.5%, which also contributed to the decline.
Last month’s building permits were down 5.3%; earlier today, the reported building permits showed 1.635m vs the 1.610m expected, which is a 2.6% increase for July. This is an indication that home building is going to increase later in the year.
The mixed retail sales numbers is a sure indication of consumers concerns over the resurgence of the virus, as spending has been shifted to the services sector.
The data looks promising in terms of new builds; however, the Fed’s timing on tapering and interest rate hikes added to the ongoing Covid-19 crisis ads to the market participants’ concerns.
At the time of writing, the S&P500 was trading 4438 and was down 0.12%. The Dow Jones was down by 0.15% to 35,205, and the Nasdaq composite was 0.17%, down to 14,972. MetaNews to keep you updated on the latest happenings.