Stock Market Update

The stock market is on track for a relatively subdued opening following a busy morning of economic data and earnings reports.

Housing starts increased 10.8% month-over-month in March to a seasonally adjusted annual rate of 1.502 million units. Building permits, meanwhile, declined 10.8% month-over-month in March to a seasonally adjusted annual rate of 1.372 million units.

The key takeaway from the report is that there was broad-based strength in starts by region but also broad-based weakness in permits by region. The latter is the better indicator for the impact of the Iran war and the uncertainty it has created because permits are a leading indicator.

Durable goods orders increased 0.8% month-over-month in March (Briefing.com consensus: 0.5%) following an upwardly revised 1.2% decline (from -1.4%) in February. Excluding transportation, orders were up 0.9% month-over-month (Briefing.com consensus: 0.6%) following an upwardly revised 1.2% increase (from 0.8%) in February.

The key takeaway from the report is that there was a big jump (+3.3%) in new orders for nondefense capital goods excluding aircraft. This is a proxy for business spending, and it is believed to reflect in part the pickup in capital expenditures for AI initiatives.

The Advance Intl. Trade in Goods deficit was $87.9 billion in March versus $83.5 billion in February. Advance Wholesale Inventories were up 1.4% following a 0.9% increase in February. Advance Retail Inventories jumped 0.7% in March following a 0.3% increase in February.

The key takeaway from the report is that the uptick in inventories should provide a boost to Q1 GDP.