US Stock Market Overview – Stocks Hit Fresh Highs Led by Financials, Housing Starts Beat
US Stocks continue to rise on Monday, with the Nasdaq rising to all-time highs. Prices were driven by stronger than expected industrial output and Housing starts. Sectors in the S&P 500 index were mixed, driven higher by Financials. Real-estate bucked the trend. Energy shares continue to remain buoyed as crude oil prices closed close to $61-per barrel for WTI.
Manufacturing Output Climbs
Industrial output rebounded more than expected in November, according to the Federal Reserve. Manufacturing production rose 1.1% last month after a downwardly revised 0.7% fall in October. Industrial output also rose 1.1% in November after a downwardly revised drop of 0.9% in October. Excluding automobiles and parts, overall industrial production and manufacturing output in November rose 0.5% and 0.3% respectively.
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Expectations had been for manufacturing output would rise 0.7% and industrial output would increase 0.8% in November. Production at factories still fell 0.8% in November on a year over year basis. There was a 12.4% jump in the production of motor vehicles and parts in November. Overall, production rose 2.1% for consumer goods and 1.7% for business equipment.
Housing Starts Climb More than Expected
US Housing Starts increased more than expected in November and permits for future home construction surged to a 12-year high. Housing starts rose 3.2% to an annual rate of 1.365 million units last month, with single-family construction racing to a 10-month high and activity in the volatile multifamily sector increasing for a second straight month, according to the Commerce Department. Data for October was revised higher to show homebuilding rising to a pace of 1.323 million units. Expectations were for housing starts to increase to a pace of 1.345 million units in November. Housing starts jumped 13.6% on a year over year in November. Building permits increased 1.4% to a rate of 1.482 million units in November, the highest level since May 2007.
Energy Shares Continue to Climb
Energy shares continue to rise along with oil prices despite a larger than expected build in total petroleum inventories. According to the Energy Information Administration, crude oil inventories increased by .8 million barrels from the previous week. Gasoline inventories increased by 5.4 million barrels last week and are about 5% above the five year average for this time of year. Distillate fuel inventories increased by 4.1 million barrels last week and are about 9% below the five year average for this time of year. Total commercial petroleum inventories increased last week by whopping 17.2 million barrels last week.
Demand also eased. Total products demand over the last four-week period averaged 20.4 million barrels per day, down by 2.4% from the same period last year. Over the past four weeks, gasoline demand averaged 9.1 million barrels per day, up by 0.1% from the same period last year.