The improving economic conditions, coupled with healthier employment levels and continued loose monetary policies, have supported home construction exchange traded funds. This week, homebuilders could gain momentum on rising housing starts after a significant drop in June.
On Friday, investors will be watching for housing starts data. Housing starts are registered at the start of construction on new buildings, mostly for residential areas.
In June, housing starts plunged 9.9% on a large drop in the multifamily component, partly due to wet weather, after surging 8.9% in May, according to Bloomberg. On an annualized basis, June starts were 10.4% higher year-over-year.
Permits also fell 7.5% in June after a 2.0% decline in May.
Market observers, though, anticipate a 8.9% increase in housing starts for July, reports Kathleen Madigan for 4-traders. Additionally, permits are expected to rise 2.9%.