U.S. Home Prices Fall 5.5%; Durable Goods Orders Drop 3.6%

Bikram Pandey
25 May, 2011
New York City

U.S. stocked traded sideways as commodities gained and the dollar edged higher. April durable goods orders declined 3.6% and home prices fell 5.5% in the first quarter. Costco Wholesale Corp and Ralph Lauren Corp declined on weaker than expected earnings.

[R]11:50 AM New York – U.S. stocked traded sideways as commodities gained and the dollar edged higher. April durable goods orders declined 3.6% and home prices fell 5.5% in the first quarter. Costco Wholesale Corp and Ralph Lauren Corp declined on weaker than expected earnings.[/R]

U.S. stocks traded sideways as world markets traded lower on the ongoing worries related to the euro-zone and economic slowdown worries in China and Asia.

U.S. Durable Goods Orders Fall 3.6%

April durable goods orders decreased 3.6% or $7.1 billion to $189.9 billion, this follows three consecutive monthly increase and 4.4% rise in March.

According to the U.S. Commerce Department orders excluding transportation decreased 1.5% and defense fell 3.6%.

U.S. Home Prices Fall

U.S. home prices declined 5.5% in the first quarter from a year ago. The quarterly fall was the largest in the last two years according to the latest data released by Federal Housing Finance Agency.

Home prices that are financed by Fannie Mae and Freddie Mac fell 2.5% from the fourth quarter and declined for the fifteen quarters in a row.

Idaho led the price decline with prices dropping 16% followed by home price decline of 12% in Arizona and 10% fall in Georgia and Oregon.

Across the nation only three states registered a price increase. Alaska home price increased 2.7%, West Virginia prices rose 2.2% and prices in North Dakota gained 1.1% according to the FHFA data.

Crude Oil inventories Rise

Crude oil inventories at the end of last week rose 0.6 million barrels to 370.9 million barrels, according to the latest data from the U.S. Energy Information Administration.

Motor Gasoline inventories increased 3.8 million barrels and that of finished gasoline and blending components increased and distillate decreased 2.0 million barrels.

Greece in Focus

Olli Rehn, the European commissioner for economic and monetary affairs in an interview with Austrian newspaper Die Presse urged Greece to accelerate its 50 billion euros privatization program. He also urged Greek government to meet its budget goals.

Greek opposition party opposed the government privatization program and Prime Minister George Papandreou is scheduled to meet President Karolos Papoulias.

Stock Movers

Bank of Montreal ((BMO)) rose 0.6% or 39 cents to $63.43 after the Canada based bank reported second quarter total revenue rose 5.5% to $3.2 billion compared to $3.0 billion in the same period last year. Net income in the quarter increased 7.5% to $800 million or $1.35 per diluted share compared to $745 million or $1.28 per share a year ago.

Costco Wholesale Corporation ((COST)) slipped 2.2% or $1.81 to $79.54 after the specialty retailer reported third quarter net sales soared 16% to $20.19 billion compared to $17.39 billion in the same period last year. Comparable sales increased 12%. Net income in the quarter grew to $324 million or 73 cents per diluted share compared to $306 million or 68 cents per share a year ago.

Polo Ralph Lauren Corporation ((RL)) plunged 7.5% or $9.73 to $119.68 after the consumer apparel and accessories retailer reported fourth quarter sales surged 7% to $1.4 billion compared to $1.3 billion in the same period last year. Net income in the quarter declined to $73.2 million or $0.74 per diluted share compared to $114.1 million or $1.13 per share a year ago.

Toll Brothers, Inc. ((TOL)) gained 3.2% or 65 cents to $20.92 after the construction and financing company reported second quarter revenues rose to $319.7 million compared to $311.3 million in the same period last year. Net loss in the quarter narrowed to $20.8 million or 12 cents per diluted share compared to $40.4 million or 24 cents per share a year earlier.