Exchange traded funds tracking home construction companies remain one of the few areas still showing strength.
SPDR S&P Homebuilders ETF (NYSEArca: XHB) is up 7.1% over the past month and iShares Dow Jones US Home Construction (NYSEArca: ITB) has gained 9.4% over the last month.
Home construction in April rose 2.6% from March to an annual rate of 717,000, with year-over-year housing starts up almost 30%, report Eric Morath and Alan Zibel for the Wall Street Journal. In contrast, economists estimated the numbers would grow at an annual rate of 685,000. [Homebuilder ETFs Rally on Improving Sentiment]
Construction of single-family homes, which accounted for 69% of all housing starts in April, expanded 2.3% and was 18.8% higher year-over-year. Multifamily homes rose 3.2% for the month.
“The improvement in housing is more noticeable now, and manufacturing is pretty solid,” Joseph LaVorgna, chief U.S. economist at Deutsche Bank Securities Inc., said in a Bloomberg report.