Stocks rose after Janet Yellen’s testimony to Congress stressed that the Fed can be patient about raising interest rates but still indicated that the Fed will likely raise rates later this year. Markets were also buoyed by Greece receiving preliminary approval of a four month extension of its bailout. On Friday, a disappointing downward revision to 4th quarter Gross Domestic Product caused stocks to decline. For the week US stocks rose but foreign markets gained more and bond prices fell. The dollar strengthened against a basket of foreign currencies.
In particular this week:
- The National Association of Realtors reported:
- Sales of previously owned homes fell 4.9% in January. January sales were still 3.2% above last January. December sales were revised upwards from a 5.07 million pace from initially reported 5.04 million.
- Its forward looking pending home sales index rose 1.7% in January. December was also revised upwards.
- Case-Shiller reported that home prices in the US rose 4.6% last year, the smallest increase since home prices began to recover in 2012.
- The Commerce Department reported that:
- New home prices fell 0.2% in January, less than expected.
- Durable goods orders rose a seasonally adjusted 2.8% in January, better than expectations. Excluding the volatile transportation sector durable goods orders rose 0.3%.
- The estimate of fourth quarter Gross Domestic Product growth was revised down from 2.6% annual pace to 2.2%.
- The Labor Department reported that:
- Consumer prices in January fell 0.7%. From a year earlier, prices were down 0.1%, the first year over year decline since October 2009. Excluding food and energy prices were up 0.2% in January and 1.6% from a year ago.
- First time jobless claims rose 31,000 to a seasonally adjusted 313,000 in the prior week worse than expectations.