Stocks and exchange traded funds (ETFs) are up this morning, even though the markets had a slate of bad news with coffee and a side of bacon.
Foreclosures in the United States shot up 55% in July from a year ago, says Alan Zibel for the Associated Press. It was also an increase of 8% from June.
Even though the government intervened to help stem the housing crisis, it’s predicted that nearly 2.8 million homes will either face foreclosure, turn their homes over to lenders or sell the properties below the mortgage value by the end of 2009.
Meanwhile, home prices are continuing their slide. In the last year, the cost of a home has gone down 7.6%, Les Christie for CNN Money reports. The aforementioned foreclosures are helping drive down the numbers. Some areas have seen double-digit year-over-year losses: Sacramento, Calif., homes have sunk 35.6%; Los Angeles homes have lost 29.6%; Las Vegas home prices have fallen 23.6%.
Prices are still going up in other areas, though, sending inflation up at its fastest rate in 17 years, reports Martin Crutsinger for the Associated Press. The 0.8% increase was twice what had been expected. It’s the third consecutive month of big inflation jumps.
Relief from high energy prices seems to be on the way. Gas hit $4.11 a gallon in July, but has since fallen to $3.79. Oil is down $30 a barrel from its July peak.
ETFs trading higher today include:
- SPDR S&P Homebuilders (XHB), down 3.5% year-to-date
- iShares Dow Jones U.S. Home Construction (ITB), down 11.8% year-to-date
- FocusShares ISE Homebuilders Index Fund (SAW), down 13.1% year-to-date
- DJ Wilshire REIT (RWR), up 1.7% year-to-date
- iShares Dow Jones U.S. Real Estate (IYR), down 1.3% year-to-date
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.