Investors Ignored Economic data, Stocks climbed while the Dollar Dived

The U.S stock market finished with minor gains yesterday, as participants tried once again to drive the indices to higher ground. This time round the gains were marginal as investors preferred to take money off the table, ahead of a long weekend. Due to the holidays, the U.S stock market will close early today and there will be no activity tomorrow.

Fundamental data continued to disappoint, as consumer confidence and housing numbers both came in under economist’s expectations. The housing market showed further problems as new home sales dropped significantly, showing a 355.00k reading compared to a prior 400.00k. Economists were expecting a 439.00k. The news was troubling as it showed investors that beneath the surface, the housing sector is still finding it hard to recuperate. The news also spooked investors going forward, knowing that a major part of the recent rebound in the housing sector is due to tax breaks. Economist are now pondering what will happen towards the beginning of next year, once the governments halts on its tax reliefs.

In addition, according to the Commerce Department, person income rose 0.4% during the month of November, which fueled a gain in consumer spending by 0.5%. While the numbers were positive, they showed that recent activity in the economy was mainly due to government spending and aid. Both the numbers were lower than economist’s expectations.

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Stocks bounced higher at the start of the session, but similar to previous trading days, they quickly lost their steam. Materials soared higher compared to other sectors, closing with a gain of 1.53%. The S&P500 finished the day with a 0.23% gain, while the Nasdaq closed higher by 0.75%.

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