US stocks shrug off weak housing and consumer data
US stocks have shrugged off surprisingly weak economic data.
House prices fell a faster-than-expected 1% in October, according to the widely-followed Case-Shiller index, with some cities hitting their lowest levels since 2006.
Meanwhile consumer confidence also dropped unexpectedly in December, a survey released on Tuesday revealed.
But the Dow Jones Industrial Average ended the day almost unchanged, due to quiet Christmas trading conditions.
'No good news'
"Overall it was a negative surprise," said Peter Kenny, of New Jersey-based brokerage Knight Equity Markets.
"But it's not impacting the market so much due to the light volume and lack of activity in the market today."
Prices were down in all 20 of the US cities surveyed by Standard and Poor's (S&P) for its Case-Shiller index.
The overall 1% seasonally-adjusted fall in house prices compared with September was almost double the expected rate of 0.6%.
It confirms that the US housing market is firmly on a downward trend again after enjoying a brief respite in the spring and summer thanks to a $6,000 (£3,890) first-time-buyer tax credit that expired in April.
"The double-dip is almost here, as six cities set new lows for the period since 2006 peaks," said S&P index committee chairman David Blitzer. "There is no good news in October's report."
Meanwhile, the Conference Board revealed that its consumer confidence index had fallen to 52.5 in December from an upwardly revised 54.3 a month earlier.
The survey of 5,000 households also suggested that people were finding it harder to find jobs again.
"Consumers' assessment of the current state of the economy and labour market remains tepid, and their outlook remains cautious," said Lynn Franco of the Conference Board's consumer research centre.
"Thus, all signs continue to suggest that the economic expansion will continue well into 2011, but that the pace of growth will remain moderate."
Markets had expected confidence to increase further, to 56, although this is still well below the level of 90 associated with previous periods of economic expansion.
"People are getting affected emotionally," said Keith Springer, a financial advisor in California, citing the seeming political deadlock in Washington as one factor influencing public sentiment.
"On top of that, unemployment isn't dropping - you have a split between the 'haves' and the 'have nots' in this country."
He also said the weak housing market was wearing people down.
"Without strong housing collateral for banks, you really can't get a spur in economic growth to reduce unemployment," he said.
But the gloomy mood apparently did not dent the Christmas sales, according to Mastercard's Spending Pulse survey.
It reported on Monday that retail and service sales excluding cars across the US between 5 November and 24 December were up 5.5% compared with a year ago.