Home builders D.R. Horton Inc (NYSE:DHI), Toll Brothers Inc (NYSE:TOL), M.D.C. Holdings Inc. (NYSE:MDC), The Ryland Group Inc (NYSE:RYL) and Pulte Group Inc (NYSE:PHM) shrugged off the news pending sales of existing homes in the U.S. fell, as the majority of them were up strong on the day.
Before we get into the numbers, the reason the home builders weren't affected, and are up strong, is recently released data which showed newly built home sales rose in April 7.3 percent, to a seasonally adjusted annual rate of 323,000. Those numbers exceeded expectations.
Pending home sales in the U.S. plummeted by 11.6 percent in April, far worse than expected, and sending shivers through the financial sector, which is some cases attempted to spin it as a positive and irrelevant. Of course if the numbers had shown strength, it would have been considered confirmation of an economic recovery.
The index, which measures the number of contracts signed to acquire previously owned homes in the U.S., plunged to a reading of 81.9, from a downwardly revised reading of 92.6 in March. The figure remained 26.5 percent under the cyclical peak of 111.5 in April 2010 when those looking for home were hurrying to take advantage of federal tax credits in the U.S.
RBC Capital Markets Senior U.S. Economist Jacob Oubina noted, "This paints a picture for existing home sales to fall back below the 5 million mark as pending home sales lead existing home sales by one to two months. There was absolutely nothing positive in this report. Housing remains in a depression right now. People are talking about a double-dip, but we never even recovered."
This is one of the more honest statement I've heard made about the sector. It also is accurate about the overall economy as well.
The financial press has been largely absent and derelict in its reporting on the economy, as seems they simply don't want to point out the disaster that Obama's policies have led to.
As mentioned, the housing market isn't in a double-dip, there has never been a recovery.
D.R. Horton Inc. was trading at $11.95, gaining $0.14, or 1.19 percent, as of 12:12 PM EDT. Toll Brothers Inc. was at $21.18, up $0.29, or 1.39 percent. M.D.C. Holdings Inc. was trading at $26.87, rising $0.48, or 1.82 percent. The Ryland Group was at $17.76, jumping $0.27, or 1.54 percent. Pulte Group Inc was trading at $8.11, climbing $0.25, or 3.18 percent.
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