The S&P 500 (SPX) opened Tuesday’s trading session in the red, but has since rallied to positive territory following encouraging data from the housing sector.
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July’s residential project starts surged 5.2% month-over-month to an annualized rate of 1.43 million homes, registering a five-month high and above the estimate of 1.29 million homes. Within residential projects, single-family housing starts increased by 2.8% to 939,000 units.
Residential Starts Top Forecasts, Permits Miss
The unexpected housing data comes amid high mortgage rates that have locked out homeowners and potential buyers from purchasing new homes. Better-than-expected construction of homes will also help boost second-quarter GDP.
On the other hand, building permits fell by 2.8% to an annualized rate of 1.35 million, signaling weak future demand for construction.
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