Tuesday, August 4, 2009

Real Estate Breaks Out While the Major Indices Pause

A wave of buying in the last ten minutes pushed the major indices to small gains today, following a day of lackluster trading. Stocks caught a bid early in the session following the announcement of a 3.6% increase in pending home sales for the month of June. While the broad indices bounced around near the unchanged mark all day, real estate was strong throughout the day, with IYR, the popular real estate ETF, gaining 4.8% on the day.

The chart below shows today’s action constituted a breakout for IYR, which is now trading at levels not seen since early November. Today’s volume of on volume of 40 million shares was also the highest in more than two months.

Three subsector real estate ETFs posted even more impressive gains than IYR. The FTSE NAREIT Retail Capped Index Fund (RTL) gained 6.0%, while the FTSE NAREIT Industrial/Office Capped Index Fund (FIO) advanced 5.5% and the FTSE NAREIT Residential Plus Capped Index Fund (REZ) added 4.9%. For more on the holdings of these three ETFs, check out Three Commercial Real Estate Sub-Sectors to Watch.

[source: StockCharts]


bubbs said...

bubbles O ° o 0 ° 。. *

Anonymous said...

Various U.S. stock market indexes are leading indicators relative to sectors of the U.S. economy. The heavily traded IYR index increased from its March 2009 low of about to 21 to its August fourth close of 38.3. The IYR index traded at a high of about 92 in January 2007. Time will tell when the median price of U.S. residential real estate starts to increase since the sales figures only have increased thus far. Record U.S. residential foreclosure sales are one reason for this.

The thinly traded RTL, FIO and REZ indexes (August fourth volumes of 4700, 2400 and 16700) all started to trade in the spring of 2007 at 50 and they reached lows of about 9, 10 and 15 in March 2009. The increases in these indexes to about 17.8, 19.3 and 25.8 on August fourth are not reflective of U.S. residential median price increases.

luke said...

seriously, what is this sh!t? the markets have two choices:

1) turn premarket futures green before the bell

2) turn gap down green after the bell.

if Asia closes down, the US can't open in the red. a month od this??? what a baloney market!

stonebat said...

market is getting ripen to short... either this week or next week.

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