Annual home prices rise to 7 year high; consumer confidence at 5 year high
There might be something to that theory that an improving economy is shielding the president from scandal fallout.
Two closely watched indices of the economy showed marked improvement last month. The annualized prices for single family homes hit a 7 year high last month and the Conference Board's consumer confidence index hit a 5 year high in April.
When housing prices rise, homeowners feel richer and are more willing to spend money. That may be reflected in the consumer confidence index as well.
Benchmark indexes jumped Tuesday morning with the Dow Jones industrial average up more than 200 points. The Dow, the Standard & Poor's 500 index and the Nasdaq composite index popped about 1.5% higher in the first hour of trading.
The strength of the rally surprised market-watchers, many of whom have been predicting some kind of pullback or correction after stocks have set record after record closing highs in 2013. Some of the bullish sentiment was fueled by a report out Tuesday showing consumer confidence hit a five-year high in May.
The Conference Board, a New York-based private research group, says its consumer confidence index rose in May to 76.2, the second straight increase. That's up from a reading of 69.0 in April and the highest since February 2008.
Also on Tuesday, a better-than-expected report on the housing market showed home prices continued to rebound in 20 key cities in March and a widely followed report on consumer confidence, due out at 10 a.m., is expected to show the economic outlook remains bright.
If the Dow keeps its gains throughout the day, it would be the 20th straight Tuesday in 2013 that the 30-stock index has closed higher, most of the time at record highs. And both indexes are flirting with intraday all-time highs set in recent weeks.
While this is all very good news, we have yet to see such positive economic figures translate into massive job creation. At the rate the economy is creating jobs, employment won't reach 2007 levels for another 7 years. The stubborn nature of our unemployment crisis needs solutions not found in economic data but rather in the confidence of businesses to hire more workers.
It's hard to see that dynamic changing any time soon.