Market’s turn is good for housing
KAI RYSSDAL: Pay no attention to today’s retail sales numbers. Sure, they were disappointing. But who really cares. On Wall Street, today was a day to celebrate the bounce.
Investors gave a nod to favorable moves in the foreign exchange markets. Strong corporate profits, too. But t’s been a rough week or so in stocks. And Ashley Milne-Tyte reports from New York…at least one part of the economy’s come out ahead.
ASHLEY MILNE-TYTE: Today’s rally in the U.S. followed a strong performance overnight by markets in Asia and Europe.
Al Goldman is chief market strategist at AG Edwards. He says the gains represent a natural recovery from the bruising correction of last week.
AL GOLDMAN: The big thing that’s behind today’s gains and two days ago is that we remain in a bull market supported by an economy that is slowing down but still growing, and corporate earnings which are slowing down but still growing.
Still, the market is on tenterhooks, awaiting tomorrow morning’s payroll numbers. Goldman says providing they come in as expected — that is, sluggish growth of around a hundred thousand jobs — the market will probably take a breather. Still, there’s one sector of the economy that’s benefited from the recent turmoil: the housing market.
David Wyss is chief economist at Standard and Poors.
DAVID WYSS: People got scared of stock positions so they tried to get their money out of stocks and shove it into the bond market. And that lowers bond yields. One of the things they buy of course are mortgage bonds, so mortgage rates go down.
And that’s good for housing, a sector that could use some help. What investors are wondering are whether the good news in the markets will continue in the days ahead.
In New York, I’m Ashley Milne-Tyte for Marketplace.
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