Stocks were making modest gains recently after the National Association of Realtors said that the number of signed contracts for sales of existing single-family homes, condos and co-ops rose 6.3% (SAAR) in December. Economists had expected to see no change.
The report implies that lower borrowing costs and greatly depressed prices are drawing buyers back into the market, said Matthew Carniol, chief currency strategist at TheLFB-forex.com. If the government created a new good bank to write high quality mortgages at low interest rates, it would stimulate demand and help stabilize the market. It would also create competition for the existing banks, forcing them to get back into the market for new mortgages.
In recent trade, the DOW was moving higher by 0.4%. The broader S&P 500 was up 0.38% and the NASDAQ 0.25%. The dollar was weaker across the board, falling 1.34% against the euro, 0.37% to the yen, 2.55% against Australia's currency and by 0.97% to the pound. NYMEX crude for March delivery was gaining 2% to $40.91 per barrel while COMEX gold for April delivery was down 0.3% to $904.50 per ounce.