Stock Market Update

The S&P 500 futures are down 18 and are trading 0.4% below fair value, the Nasdaq 100 futures are down 73 points and are trading 0.5% below fair value, and the Dow Jones Industrial Average futures are down 65 points and are trading 0.2% below fair value.

Total housing starts declined 6.8% month-over-month in July to a seasonally adjusted annual rate of 1.238 million units (Briefing.com consensus 1.350 million), with single-unit starts down 14.1% to 851,000. Building permits were down 4.0% month-over-month to a seasonally adjusted annual rate of 1.396 million (Briefing.com consensus 1.440 million), with single-unit permits down 0.1%.

There is some chatter that Hurricane Beryl had some influence over the disappointing data, yet that isn't a totally adequate excuse given the decline in single-unit starts and permits in the West where Hurricane Beryl had zero impact. The key takeaway, then, is that conditions in the residential construction market remain soft with higher rates acting as a constraint.

Treasury yields moved up in response. The 10-yr yield was at 3.87% earlier, but sits at 3.89% now. The 2-yr yield moved from 4.04% to 4.05%.