Social media was ablaze in the last twenty-four hours arguing over yet another mundane topic: the color of a random Scottish woman’s mother-of-the-bride dress. Half the population in cyber la-la land believed the dress was white and gold, while the other half (which was correct) saw a blue and black dress. The same bipartisan split could be said about the stock market; after several sessions of new highs, the major indices are floating along in the red though investors are still quite bullish. A drop was expected after the second revision of the Q4-2014 US gross domestic product (GDP) which was revised lower to 2.2% (from 2.6%), but the good news is that softer growth was primarily due to a lower estimate for inventory levels. This was to be expected given the West Coast port shutdowns over the last month, but a boost in sales should help this discrepancy level out.

Aside from the GDP reading, there was even more mixed data leading to an ambiguous-colored market. Firstly, the purchasing managers index (PMI) in the Chicago area noted some very disappointing manufacturing activity for the month of February. The Chicago PMI plunged by 13.6 in the month to a sub-50 level of 45.8 for the lowest reading since July 2009. Ultimately, the report attributes the massive drop to bad weather and residual effects from the West Coast port slowdown over the last month. New orders, production and employment all posted double-digit declines in February. Supplier deliveries slowed for the month as well, which is normally a sign of economic strength, but once again this is tied to delivery delays related to the port shutdown. The Chicago report actually covers both the manufacturing and non-manufacturing sectors, which makes the index more volatile than the Fed manufacturing reports. We will chalk this one up to an outlier since other data is pointing to moderate growth for the month.

There continues to be mixed signals among the American consumer as the Conference Board reported lower confidence in February while the University of Michigan noted that sentiment improved in the month. In the last two weeks of February, the final consumer sentiment index reading improved sharply to a final reading of 95.4, which was up 1.8 point from the mid-month reading. This final reading points to a pace of 97 in the last two weeks of the month which doesn’t show much slowdown from January’s final reading of 98.1. Oddly enough, the sharpest move to the upside was in the current conditions component which increased to 106.9 from 103.1 in the preliminary reading. This component ultimately points to steady rates of consumer activity for February compared to the month prior. The expectations component increased by 1.5 points from the mid-month reading to 88.0, meaning that the pace was over the 90-level in the last two weeks of the month. We note that this component heavily relies on the outlooks for employment and income, both of which could surprise us on February’s jobs report next week. Ultimately, February’s reading on the spirit of the US consumer has been in decline before today’s report, which derives most of its strength from the jobs market and so we may be in for a surprise.

Lastly, the housing market got another check in the positive column this week with the January pending home sales report. For the month, pending home sales increased by 1.7% to an index reading of 104.2, a substantial improvement over the upwardly revised December reading of 102.5 (from 100.7). When broken down by region, the two largest regions showed the greatest strength. The South increased by 3.2% and the West at 2.2% month-over-month. For the other two, the Midwest region declined slightly by 0.7% in January, while the Northeast region remained relatively unchanged at 0.1%. This data ultimately rounds out a week of mixed housing data, but points to a potentially strong spring selling season.