Midday Market Update: New Home Sales Send Wall Street Down

October 28th at 10:00am by Tom Lydon

ETF UpdateStocks and exchange traded funds (ETFs) sank into negative territory this morning as a disappointing report about the real estate sector emerged.

New home sales had an unexpected 3.6% drop in September. Waning effects from the government’s tax credit for first-time homebuyers are being blamed for the decline, reports Alan Zibel for the Associated Press. September’s decline was the first since March. SDPR S&P Homebuilders (NYSEArca: XHB) is down more than 3% this morning. For more stories on real estate, visit our real estate category.

The Treasury Department and the GMAC, the former lending arm of General Motors, are in talks for a third round of taxpayer-funded aid. The Treasury mandated that GMAC raise another $11.5 billion after stress tests, but the lender has had to go back to the government for more cash, Reuters reports.

ConocoPhillip’s (NYSE: COP) announced its third-quarter earnings fell 71% from a year ago. The company blames lower gas and oil prices along with poor refining margins, reports Isabel Ordonez for Dow Jones Newswires. Exxon Mobil (NYSE: XOM) and Chevron (NYSE: CVX) are expected to report lower earnings tomorrow and Friday, respectively. Vanguard Energy (NYSEArca: VDE) is down more than 2% this morning; ConocoPhillips is 6.6%; Chevron is 13.1%; and Exxon is 19.5%.

Durable goods orders in September climbed, which is being hailed as a favorable sign for U.S. manufacturing. The 1% jump is the fourth increase in six months, reports Greg Robb for MarketWatch.

For more stories on oil, visit our oil category.

The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.

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