Tuesday, April 17, 2007

Weak housing start better than decline...

It was a feeble even weak rise, 0.8 for March's houseing starts but it was enough to make investors feel a bit more secure on Wall Street today. That is the reason given for the small rise in trading today with the Dow Jones industrials briefly into record territory.

Not everyone is feeling happy:
Giving investors some additional relief, the Labor Department's core consumer price index rose 0.1 percent in March, less than expected, and alleviating some anxiety about the Federal Reserve's need to raise interest rates to curb costs. The overall consumer price index, which takes into account energy and food, rose 0.6 percent in March — the largest increase in 11 months — and was in line with expectations.

Some investors doubt that Wall Street's optimism will last.

"I think this is sort of a weak relief rally," said Ed Peters, chief investment officer at PanAgora Asset Management Inc. in Boston. "It's nice that the core level of inflation came in lower than expected, but the headline rate is what people live on. ... There are still problems out there."

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