Wall Street opened modestly higher on Tuesday after investors took in a couple of better-than-expected economic reports.
The Dow Jones industrial average was about 17 points higher in early trading, with the broader Standard & Poor’s and the technology heavy Nasdaq up only a few points. On Monday, the Standard & Poor’s 500-stock index fell 2.4 percent, and the Dow Jones industrial average, which had closed positive for the year on Friday, fell 2.1 percent.
Investors received better-than-expected data on home construction, building permits and inflation. In the housing report, construction of new homes jumped in May after dropping sharply a month earlier. Housing starts in the United States rose 17.2 percent for the month — exceeding economists’ expectations — as construction of single-family homes increased for a third month.
The government said in its report on inflation that prices received by producers for finished goods rose a smaller-than-expected 0.2 percent in May, hinting that Wall Street’s fears of inflation may be exaggerated. Still, energy prices rose the most since January, with gasoline prices up nearly 14 percent for the month.
In a third report, the Federal Reserve said that industrial production fell more than expected — 1.1 percent — in May. Output was also weaker — down 0.7 percent — in April than initially reported. [via NY Times]
Three reports, four topics: home construction, building permits, inflation and industrial production. While home construction and building increased positively, and inflation was lower than expected, industrial production fell for May, and Output was weaker. That indicates our manufacturing (and I would argue, our level of exports, will be lower than we would have hoped, indicative of a less than desireable economic sitauation. We may have hit “rock bottom” in this economy, but it doesn’t seem like the tide has turned yet.
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