Daily Recap: Fed Cuts | Stocks Flat | Strong Housing Data

September 18, 2019 | Hoya Capital

Daily Recap: Fed Cuts | Stocks Flat | Strong Housing Data Uncategorized Sep 18 Written By As expected, for the second time this decade, the Federal Reserve lowered benchmark interest rates in response to signs of slowing global economic growth and weakening inflation expectations. US equity markets reacted favorably to the policy announcement in which eight of the ten voting members agreed to lower rates by at least a quarter percentage point and rallied during the subsequent commentary, clawing back early-day losses to end the day mostly flat.

The S&P 500 ETF (SPY) climbed 0.1% on the day while the Nasdaq ETF (QQQ) finished fractionally lower. In a market response that will likely be seen as a "success" for Fed Chair Powell in walking a proverbial tightrope, the 10-year yield ended slightly lower to end the day at 1.79%. Coming off back-to-back 1% gains to start the week, the broad-based REIT ETF (VNQ) finished slightly lower, retreating by 0.3% on the day.

The growth-oriented mall, hotel, and timber REIT sectors were the lone sectors in positive territory while declines were led by the industrial, student housing, and healthcare REIT sectors. Top individual performers on the day included CBL & Associates (CBL), Simon Property (SPG), Park Hotels (PK), Kimco (KIM), and Equinix (EQIX). The Hoya Capital Housing Index , the benchmark that tracks the performance of the US housing industry, finished the day lower by roughly 0.1%, led to the upside by the Homebuilding and Mortgage Lending and Services sectors.

Realogy (RLGY), Lennar (LEN), PPG Industries (PPG), Owens Corning (OC), and NVR (NVR) were among the individual best-performers on the day following better-than-expected housing starts and permitting data, which each climbed to the highest rate since 2007. The Home Furnishings sector was the relative laggard on the day. Home construction in the US surged to the highest monthly rate in more than 12 years in August as the combination of lower ...