Morning Report Thursday 25 September 2014
US New Home sales climb to a six-year high, we revisit stocks that should benefit
US equities rebounded strongly overnight, rallying almost 1% as US New Home Sales Figures yet again confirm the US economy is currently in very good shape – the data was a whopping 17% above “expert economists’” expectations. However, the median sales price declined 1.6% in August; it appears builder’s appetite for margin has decreased in the US. When figures become so strong, the big question is should we jump on, or is the move / trend factored into prices and it’s time to sell out? Investors should always be conscious that equity markets generally lead fundamentals by 6-9 months. Interestingly, after an excellent 2-3 years, the 3 stocks I am evaluating have had a poor 6 months. Overall, I remain positive the US economy and hence companies with exposure to both the US economy and earnings are of interest to me.
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