Markets Decide That Economic Data Today Show A Glass Half Full

The U.S. stock market decided that today’s economic reports showed a glass half full. Interpretations pointing in the other direction, however, were easy enough to make so the end result wasn’t so much a wave of optimism lifting markets strongly higher as a sigh of relief. For the day the Standard & Poor’s 500 stock index was up 0.17% and the Dow Jones Industrial Average was ahead 0.29%. The technology heavy NASDAQ Composite index finished dead even for the session. Gold continued its recent weakness, dropping another $4.20 an ounce, or 0.32%–to $1313.60 an ounce. West Texas Intermediate gained 1.8% to $62.29 a barrel. International benchmark Brent gained 1.6% to $66.16 a barrel. The yield on the 10-year Treasury rose 2 basis points to 2.84%.

On the glass is half full side: Industrial production climbed 1.1% in February after a revised decline of 0.3% in January. Economists had expected a gain in February of 0.3%. Consumer sentiment for March in the University of Michigan survey jumped to 102.0 from 99.7 in February. Economists had expected a reading of 99.5. The March reading is the highest level for the sentiment index since April 2004.

On the glass is half empty side: Housing starts ran at an annual rate of 1.236 million units in February. That was below the 1.283 million unit annual rate projected by economists surveyed by and down from a revised 1.329 million units in January. Housing permits, a leading indictor of housing starts since permits turn into new building, fell to an annual rate of 1.298 million from a revised 1.377 million in January. In addition, the Michigan Sentiment survey showed that expectations of near-term inflation increased to the highest level in three years with consumers expecting inflation to climb to 2.9% in 2019 from less than 2% currently. (The Federal Reserve’s inflation target is 2%.)