The National Association of Retailers released its existing home sales data for March yesterday. The number continued to confirm softness in housing markets. In March, existing homes were sold at a seasonally adjusted annualized rate of 4.59 million. That’s a 7.5% decrease from last year and the slowest pace since June 2012. Looking at the chart below, the trend doesn’t look healthy.
There is a silver lining for economic bulls in that this data reflects closed sales (which happen with a lag), so there may still be some lingering effect from the cold winter. Still, this data is another weak point in a string of other mediocre economic data points.
For now, the market continues to look through soft data, giving the benefit of the doubt that things will get better as the year progresses. Bears may feel cheated, since the markets have been unfazed by mediocre data (including poor earnings), but that’s just the way things work. Markets are driven by psychology and psychology can stay strong until it doesn’t. Unfortunately for the bears, psychology may stay strong long enough for the bulls to be “right.”
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