The Dow fell 4 points in a boring session as traders awaited the results of the healthcare vote in the house. Trading volume shriveled up like a house cat in a snow bank with the Dow closing at 20,656.
There is no shortage of opinion regarding the direction of oil prices. Bank of America thinks oil will go to $70 per barrel by the end of the year. “Good luck with that” says Goldman Sachs which thinks just the opposite. Goldman feels prices could trade near lows as demand growth is sluggish and mega projects initiated when oil was $100 per barrel will come online later this year. The projects are in Russia, The Gulf of Mexico, Canada and Brazil and could add a million barrels a day to supply. Both sides of the debate seem to have valid reasons and if I could just figure out which guru is right then I too could be a guru. Meanwhile rating agency Fitch downgraded Saudi Arabia’s credit rating to A+ from AA- citing gubment deficits due to lower oil prices. At the close WTI crude prices finished at $47.67 per barrel off seven tenths of a point.
Brian Wesbury, economist over at First Trust and University of Montana alum, reported that even as mortgage rates move higher the latest figures for sales for new homes surprised everyone to the upside in February by gaining 6.1%. This was the fastest pace in 9 years and is now up 12.8% from a year ago. While warm weather in February could have been a factor the report shows housing trends to be positive.