US and foreign stocks had strong gains for the week after comments from the Federal Reserve indicated that the FED is watching the strong dollar and falling prices before raising interest rates. Even though the FED removed the words that they can “be patient” the statement seemed to indicate a willingness not to move too quickly. Treasury prices rose and the dollar fell on the FED’s comments. In particular this week:
- The Federal Reserve reported that Industrial Production in the US rose a seasonally adjusted 0.1% in February. However, this was attributed largely to utilities that increased production by 7.3% due to the unusually cold February. Capacity utilization fell 0.2% to 78.9%. Industrial production was up 3.5% from a year ago. Motor vehicle output fell 3% and mining output (including oil and gas) fell 2.5%.
- The National Association of Homebuilders reported that builder confidence fell to 53 in March versus 55 in February. Anything over 50 represents a positive outlook.
- The Commerce Department reported that US housing starts fell 17% in February. Single family starts were down 14.9% and multifamily starts were down 20.8%. The sharp decline was attributed on the severe winter weather in February. New applications for building permits actually rose 3% which is an indication of housing starts going forward.
- The Labor Department reported that first time claims in the prior week rose slightly 1,000 to 291,000. The week before that was revised from 289,000 to 290,000. The four week moving average of claims rose 2,250 to 304,750.