The United States economy remains in a state of uncertainty and this apathy is reflected in the actions of investors and their stocks and exchange traded funds (ETFs).
The state of the nation’s Big Three automakers has turned more economic data negative, while investors are wary to spend money anywhere as consumer prices and new home construction are frozen. A severe correction amid the housing industry is still in full swing and consumer pricing has plunged to all-time lows, reports Joe Bel Bruno for Associated Press.
On a global scale, the economy is sluggish as well, with market sentiment remaining bearish. Oil prices have fallen to $54 per barrel; could oil prices be bottoming out as the symbolic $50 is near?
The contract for December delivery has settled at $54.39, the lowest since January 2007, says George Jahn for Associated Press. Also on their way down are gas prices. The price of gas dropped below half of their record high as of Wednesday, falling for their 63rd straight day, reports Julianne Pepitone for CNN Money.
The national average is $2.047 per gallon.
- United States Oil (USO), down 40.9% year-to-date
- United States Gasoline (UGA), down 53.2% since Feb. 28 inception
On the housing front, mortgage application volume dropped 6.2% during the week of Nov. 14. The trade group’s application index slipped to 398.6 during the week, down from 425 a week earlier. For perspective, the index peaked at 1,856.7 during the week ending May 30, 2003, at the height of the housing boom, reports Yahoo Finance.
U.S. home construction has fallen to levels not seen since 1959, as builders cut back and Wall Street takes a walk down memory lane, but not by choice. Record-low paces for building homes and apartment buildings are at a snails’ pace, and the new building permits are plunging, which is an indicator of future activity, reports Alan Zibel for Associated Press.
The numbers from the Commerce Department are nostalgic, as they are the lowest on government records dating back to January 1959. Previously, the slowest pace had been in January 1991, when the country was in recession and going through a similar housing correction.
- SPDR Dow Jones Real Estate (RWR), down 50.1% year-to-date
- SPDR S&P Homebuilders (XHB), down 44% year-to-date