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Wall Street Edges Higher at Open as Housing Data Cap Rebound; Dow up 140 Pts

Stock MarketsJul 20, 2021 09:40AM ET
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© Reuters.

By Geoffrey Smith 

Investing.com -- U.S. stock markets opened modestly higher on Tuesday, but another sign of the housing market weakening took much of the energy out of an overnight rebound. 

By 9:40 AM ET (1340 GMT), the Dow Jones Industrial Average was up 140 points, or 0.4%, at 34,105 points, recouping only one fifth of its 2% loss on Monday, when the market was gripped by fears of another Covid-19-driven slowdown. 

The S&P 500 was up 0.4%, while the Nasdaq Composite, which had outperformed on the way down on Monday, was down another 0.2%.

Earlier, building permit data for June surprisingly fell 5.1%, to their lowest level since November. Granular data from the report showed a drop in permits across all major regions, against a backdrop of higher raw materials prices and anecdotal labor shortages.  Housing starts rose, but Pantheon Macroeconomics' Ian Shepherdson argued that the starts number "was more noise than signal."

"Housing market activity, both sales and starts, has not yet fully adjusted to the near-30% drop in mortgage applications since their December peak, so we expect further declines over the next few months," Shepherdson said, adding that it's still far from clear that mortgage applications have bottomed out after falling from their post-Covid peak.

Fears about a resurgence of the pandemic were evident in a 7.2% rise in Novavax (NASDAQ:NVAX) stock and a 5.1% rise in Moderna (NASDAQ:MRNA) stock. BioNTech (NASDAQ:BNTX) stock meanwhile, also hit a new record high with a 2.0% gain. The stocks were also supported by signs of a change in policy at Fox News, where host Sean Hannity and others have suddenly swung behind supporting the national vaccination campaign. Fox has so far been a conduit for some of the more skeptical opinions toward Covid-19 vaccines. 

On a heavy day for earnings, IBM (NYSE:IBM) stock stood out with a 4.8% gain after revenue growth - its Achilles' heel for the last decade - came in substantially above expectations, bolstering confidence in its transformation into a Cloud-centered service provider. 

HCA (NYSE:HCA) stock also stood out, rising 11% after it too provided a quarterly update well ahead of forecasts, mirroring larger rival UnitedHealth (NYSE:UNH) in profiting from a resumption of non-Covid-related procedures as the pandemic eases. Revenue rose 30% from a year earlier, while comparable emergency room visits rose 40%. The company also raised its guidance for the year. Elsewhere in health, a new partnership with UnitedHealth helped Peloton Interactive (NASDAQ:PTON) stock rise 3.2%, more than recouping its losses from Monday.

On the downside, Coinbase Global (NASDAQ:COIN) stock fell 2.2% as a number of cryptocurrencies, including Bitcoin, extended their declines. Virgin Galactic (NYSE:SPCE) stock also fell 7.2% after Amazon (NASDAQ:AMZN) founder Jeff Bezos completed his first jaunt into space with a low-orbit flight lasting just over 10 minutes. The flight underlined that Virgin will face competition all the way in the nascent space tourism business.

Wall Street Edges Higher at Open as Housing Data Cap Rebound; Dow up 140 Pts
 

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Comments (13)
Rosh Jardine
RoshJardine Jul 20, 2021 10:49AM ET
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Really? When oil is slipping lol
TL Chan
TL Chan Jul 20, 2021 10:31AM ET
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Seen it many times!
TL Chan
TL Chan Jul 20, 2021 10:30AM ET
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You create the momentum to attract people placing their bet, then the big guy suddenly distribute the stocks , then you hold bag.
Michael Dell
Michael Dell Jul 20, 2021 10:29AM ET
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Fed has unofficial mandate to make the super rich continue become more richer
TL Chan
TL Chan Jul 20, 2021 10:27AM ET
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no one know why growth scare suddenly vanish, even in face of not good housing data! Stay away! It might come back down drastically near market close.It is a mid day last breath gambling or say a bull trap !
Mitchel Pioneer
Mitchel Pioneer Jul 20, 2021 10:18AM ET
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As yes, as expected, a major "rally" the day after a major loss.  The 2-day recovery of yesterday's loss in underway.  Or will they be flagrant enough to wipe out the entire loss today?  Only in the US Ponzi Scheme, BIGGEST INVESTMENT JOKE IN THE WORLD.
King Agamemnon
King_Agamemnon Jul 20, 2021 10:13AM ET
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yesterday the downmove was because of "Covid surge". So today's uptick should be because of a "Covid drop" right?
Steves View
Steves View Jul 20, 2021 10:08AM ET
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I'm shocked , That reporters are shocked.  This was biggest joke in world History. Lets reward people staying home getting extra $600 a week, Then kick sand  in face to ones who went to work. So if housing is down, Who cares. That's not number one problem right now.
Stan Smith
Stan Smith Jul 20, 2021 10:02AM ET
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Wow...Inflation and the pandemic have magically disappeared again! Who is responsible for the wonderful piece of market 'engineering'? Hmmm
perplexed76 .
perplexed76 . Jul 20, 2021 10:02AM ET
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they buying bonds and stock papers at the same time
Tushar Ingle
Tushar Ingle Jul 20, 2021 10:01AM ET
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they fudge numbers to manipulate markets even in USA
christos rousakis
christos rousakis Jul 20, 2021 9:59AM ET
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all trifle together all liers is here ha ha ha fed bidden enough lor of lies
Install Expert
Install Expert Jul 20, 2021 9:56AM ET
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"Earlier, building permit data for June surprisingly fell 5.1%, to their lowest level since November." Geoffrey Smith must not have bought a sheet of plywood lately or heard about people steeling materials off of job sites. Even those with cash are going to have a hard time finding homes soon because those would be sellers won't be able to afford to move anywhere else. In '08 and '09 it was "we buy forclosures" at every stop sign, this time it's a 17 dollar sheet of plywood going for 89 dollars. Nothing you surprising about it really.
Ronald Warren
Ronald Warren Jul 20, 2021 9:56AM ET
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We're not finished with the inflation of construction materials. Recently, Lowe's increased Hardi-backer to $22.98 a sheet. Yesterday, I paid $16.89 for drywall. All prices running. Old work electrical boxes cost me $4.50 a piece last week. Almost couldn't find them. Usually a buck. 400% inflation! Not in this surplus cash induced economy!
 
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