Stocks today were on a roller coaster ride. The Dow opened lower by 250 points following a selloff in oil but then when the oil stockpile build number was released it was much lower than expected causing a reversal and pulling the Dow up with it. At the close the Dow was up 53 at 16,484 on heavy volume.
In economic news, the Markit Flash February services PMI reading came in at 49.8, down sharply from 53.2 in January and a touch below the key 50.0 level which was disappointing unless you are a pessimist. New home sales for January were reported at 494,000 coming in below expectations calling for a level closer to 520,000. With home prices up 5.74% in 2015 and a skimpy 4 month inventory level, many are predicting further price gains in 2016 saying that housing will remain a bright spot in the US economy.
Lowes Home Improvement reported a 6% rise in sales and a 28% gain in profits. The numbers matched expectations which, for some oddball reason, was perceived as a disappointment by the guru crowd. It seems the key to being a respected equity analyst is that you have a knack for finding despair in the midst of prosperity.
At a meeting of US shale oil producers, Saudi Oil Minister Ali the-Naimi popped by and said production cuts would not happen although a deal to freeze output might be in the cards at a meeting planned for March. Meanwhile, the boys over at T. Rowe Price put together a slideshow about current oil markets and they feel that prices will stay low for another 8 to 10 years given the current supply and demand trends. Cheap oil means exporters will eventually cut gubment spending which implies a slower global economy going forward baring a war breaking out somewhere. At the close, WTI crude was up 1.3% to $32.29 per barrel.
Gold today was up $7.50 an ounce to $1,230.