U.S. stocks and exchange traded funds (ETFs) zig zag in early morning trading as investors are unsure how to read the latest data on the housing sector.
The Commerce Department reported that new home sales edged up 0.7% in August, however, this increase fell short of the 1.6% expected by economists. This is good news, but investors were unsure how to take it due to its discrepancy from anticipated results. The news sent the iShares US Dow Jones Real Estate Index (NYSEArca: IYR) up 0.2% in morning trading.
In other news, the Commerce Department reported a decline in orders meant to last three years or longer by 2.4%, after increasing 4.8% in July and missing analyst expectations of an increase by 0.5%. The drop was due primarily to a sharp fall in demand for commercial aircraft, a highly volatile portion of the orders report. Even excluding aircraft and other transportation goods, orders were flat in August.
In Philadelphia, a Group of 20 world leaders are uniting behind a plan to force banks to tie compensation more closely to risk and tighten capital requirements, while they agreed to maintain stimulus measures to spur the global economy. Additionally, they are turning their attention from crisis management to overhauling the rules governing financial markets as the group assumes the mantle as the world’s main forum for global economic cooperation, states Simon Kennedy and Gonzalo Vina of Bloomberg.