Midday Market Update: Markets Shrug Off Weak Housing Data | ETF Trends

U.S. stocks and exchange traded funds (ETFs) are managing to trade in positive territory this morning despite weak housing data and mixed retail earnings reports.

The Commerce Department reported that construction of new homes and apartments fell in July by 1% last month to a seasonally adjusted annual rate of 581,000, down from a revised rate of 587,000 in June.  Economists were expecting the rate to be at 600,000.  Building permits, a good indicator of future activity, fell by 1.8% as well.  The news sent the iShares Dow Jones U.S. Real Estate (IYR) up nearly 0.6% in morning trading.

In the retail sector, the largest home improvement retailer, Home Depot (HD), said that its second-quarter profits fell by 7%. Home Depot lifted its guidance for full-year earnings from continuing operations, however.  The Atlanta-based company reported earnings of $0.67/share, topping Wall Street’s expectations of $0.59/share.

Retail giant Target (TGT) reported earnings of $0.79/share, beating analysts’ expectations of $0.66/share as the company witnessed strong operating margins in their retail and credit card segments.  Additionally, discount retailer TJX Companies (TJX), which operates stores like TJ Maxx and Marshalls, reported earnings of $0.61/share beating Wall Street’s expectations by a penny as the company witnessed an increase in sales by 4%.  The news sent the Retail HOLDRs (RTH) up nearly 0.8% in morning trading.

In the financial sector, CIT Group (CIT) reported a second-quarter loss of $1.68 billion, much higher than the $1.95/share loss forecast by Wall Street.  One of the nation’s largest lenders to small- and mid-size businesses is facing an uphill battle. Its borrowing costs are starting to outpace the money that it generates from lending to customers and there are fears that it may have to file for bankruptcy protection.