Seesaw

The seesaw in oil and the markets continues. Both were down pretty significantly until the Energy Information Administration (EIA) released its weekly report showing a build in crude inventories of 3.5 million barrels to 507.6 million, but it was a smaller build than expected and far less than had been reported by the American Petroleum Institute (API). Yesterday, the API spooked the markets when they said crude increased by 7.1 million barrels. That coupled with the comments from Naimi, Saudi’s oil minister, took a toll on oil. However, oil is now positive and stocks are well off the lows.

Housing

On the date front, we got disappointing new home sales for contracts signed in January. New home sales of 494,000 fell 9.2 percent from Decembers 544,000 units. New single family home Sales in the West declined a whopping 32.1%, the lowest level since July 2014. Despite the blizzard, sales in the Northeast were up 3.4%, down 5.9% in the Midwest and up 1.8% in the South.

Supply of new homes, especially on the lower end, continues to be tight. There has been a move from luxury homes buyers to more first time buyers, which was reflected in the median home price falling 4.5% to $278,800. Despite the decline, economist say the housing recovery does remain intact.

We also received the U.S. services PMI business activity index, which declined from 53.2 in January to 49.8. While the number indicates a contraction, many blame the decline on the blizzard.

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At this point, we are going to keep our powder dry. While the reversal in oil, especially since the European markets closed, is impressive, let’s see how stock continue to trade for the remainder of the day.