First month of 2014 slams Wall Street, Dow falls 5%
HW 30 follows the other indices down
The HW 30 declined Friday, as the Dow Jones finished the month of January down by 5%.
Does this spell bad news for the rest of 2014?
It’s hard to cast wide predictions at this point, but comforting news is not exactly coming from Wall Street.
As HousingWire’s Trey Garrison reports disappointing earnings, news of more Fed tapering and euro zone deflation fears prompted heavy stock sales in recent days.
Housing data also remains hard to pin down.
While pending home sales declined in December – and housing groups blamed it on the weather – the market is dealing with a great deal of contradictory data.
As banking analyst Christopher Whalen notes the S&P/Case-Shiller 20 City Index rose at a 13.8% annual rate in November.
But Whalen is not singing an optimistic tune. He wrote:
“Indeed, it can be argued that the US housing sector has not really recovered significantly and remains a major drag on US economic growth. Back in November 2012, I predicted that housing would be a drag on the US economy and could even drag us back into recession. The reason? The failure by Congress and federal regulators to restructure under water borrowers would eventually become a dead weight, limiting growth and job creation, as well as home price appreciation, as it did from the 1920s through until the early 1970s.”
So what’s the result of all this uncertainty? The answer is volatility.
The HW 30 declined 0.85% Friday, while the Dow and S&P 500 finished down 0.94% and 0.65%, respectively. The Nasdaq also declined 0.47%.