Weekly Market Outlook – Losing Speed At The End Of The Runway

Finally, on Friday we got last month's housing starts and building permits. Economists were calling for a modest improvement to February's tallies, which still wouldn't have snapped the data trends out of their slowdown. Instead, we saw another round of modest declines.

Housing Starts and Building Permits Charts

Source: Thomson Reuters

Everything else is on the grid.

Economic Calendar

Source: Briefing.com

This week is going to help round out the real estate picture. On Monday we'll hear last month's existing-home sales report, followed by new-home sales numbers on Tuesday. Though both raced higher pretty firmly in February, economists are calling for slight declines for last month.

New, Existing Home Sales Charts

Source: Thomson Reuters

Don't be surprised if these numbers roll in better than expected.

To that end, on Tuesday we'll get February's FHFA Housing Price Index figure. Though price-appreciation has been slowing down, it's still making forward progress. Higher home prices may be part of the reason purchases are tepid, but a balanced trade-off may be what's best.

Home Price Index Charts

Source: Thomson Reuters

We won't get the S&P Case-Shiller Home Price Index update until next week. We will, however, get the first estimate of Q1's GDP growth rate. The pros are expecting a slower pace, of 1.9%, after Q4's also-slower pace of 2.2%. Given the lull in industrial production and capacity utilization, the outlook for Q1 is probably on target.

GDP Growth Charts

Source: Thomson Reuters

Stock Market Index Analysis

Even with just a quick glance at the weekly chart of the NASDAQ Composite, the market's problem becomes clear - too much, too fast, with fading buying interest the higher stocks go. Volume was going to be poor no matter what.

NASDAQ Composite Weekly Chart, with Volume

Source: TradeStation

Even the one relieving aspect of the NASDAQ's chart isn't all that relieving. That's the VXN. It's not yet back to its absolute floor around 11.8, but last week's low of near 15.0 is still a major technical support level in and of itself. Reaching that market doesn't necessarily mean the market can't keep on climbing. But, it does make it tougher to do so.

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