US New Home Sales Post Unexpected Decline

Sales of new homes in the US posted an unexpected 0.6% decline to 342K in May following a revised down 344K annually as of April. Economists polled by Bloomberg had forecast the indicator to rise 2.3% to 360K from a pre-revised figure of 352K. Sales grew in three of the four regions while the south, the largest zone, fell to 184,000 from 201,000 in April. The months supply of homes on the market, meanwhile moved slightly lower to 10.2 months from 10.4 as the number of homes for sell fell 2.34%. Also of note, the report showed increasing prices as the average price of a home jumped 5.2%. This increase matches the recent existing home sales report that also posted higher prices for May. Indicators on housing appear to be showing improvements in the sector as housing starts posted a sharp advance in the previous month and the MBA mortgage applications report showed rates fell from recent highs in the past two weeks.

Equity markets are currently trading higher by more than one percent while the NASDAQ leads at more than two percent following a positive outlook from software maker Oracle. On the currency front, the greenback appears to be gaining some ground following a mixed morning against major crossed.