By Jennifer Coombs, Research Analyst

The markets continue their dramatic waves of volatility over several noteworthy items. Overnight, Chicago Federal Reserve Bank President, Charles Evans, noted at a conference in Stockholm, Sweden that despite the continuation of weak economic data in the US, there is still a possibility that the Fed will hike interest rates in June. In Greece, the monetary environment is getting ugly as the company owes more than 1.5 billion euros between June 5^th and June 19^th and has no plan to pay. Additionally, economists at Goldman Sachs slashed their crude oil price forecasts for 2016 to 2020, noting that improved US shale efficiency meeting global oil demand, coupled with unimpeded OPEC productivity will keep prices low.

Domestic data was light this morning, however we received one early indication of the housing market, but so far it appears that the springtime is far from robust. The National Association of Home Builders (NAHB) had been signaling strength for quite a while in the new home market, but that has yet to manifest itself in the numbers for May 2015. The NAHB composite housing market index fell by 2 points in April to a reading of 54, which was well below the low-end of economists’ expectations. This decline is reflective of a 2-point drop in the present sales component, but this remains well above the 50-breakeven level at a reading of 59. The traffic component also declined to a very weak reading of 39. The weakness noted in traffic has long been a major feature of this report, and it underscores the lack of first-time buyers in the housing sector. However, a positive in this report is a 1-point gain in future sales (next 6 months) on top of an already very strong reading. On a regional basis, the South, Midwest, and West all remain in expansionary territory for new homes, while the Northeast continues to lag far behind. Despite the apparent strength in this report, the construction and sales of new homes continues to hold down the broader economy. Tomorrow, we will receive data on the housing starts and permits for the month of April.