Stocks opened lower but went positive mid day as the Dow gained 97 points to close at 17,633. Volume was higher and markets continue to show resilience.
Federal Reserve Chair Janet Yellen spoke at a luncheon today in New York City and the main course was squab. Gurus were eager to hear her talk since several fed board members had hinted that rate hikes were in the works. Yellen however stressed a policy of “greater gradualism” as the fed tries to balance domestic pockets of strength within a trend of global weakness. Her remarks are considered dovish or in this case “squabish” meaning that rate hikes might not happen right away.
Money management firm Blackrock joined the choir with Pimco to sing the song of a possible inflation spike. Richard Turnill, Blackrock’s global chief investment strategist warned of rising labor costs and a stabilization of oil prices and suggested that investors consider adding inflation protected bonds and gold to their portfolios.
Miami based Lennar, the nation’s second largest home builder, reported earnings that once again beat Wall Street estimates. Revenue was up 21.3% while net income grew by 26%. The company delivered 4,832 new homes up 12% while the backlog of homes rose 13% to 7,670. CEO Stuart “Stewie” Miller said he expects continued slow but steady growth in housing driven by years of underproduction, low inventory, low unemployment and low interest rates.
WTI oil fell over 2.2% today as Iran indicated it might not freeze output. Meanwhile gold moved higher (thanks to Yellen’s remarks) and finished up $21 an ounce at $1,241.