It’s been a seesaw session all day. Stocks; however, have held onto early gains, as all eyes are now on the Fed minutes from the January FOMC gathering.

Stocks hit an air pocket after the Existing Home Sales report came up short with a decline of 3.2% in January, to a seasonally adjusted rate of 5.38 million.  This was due mostly from a lack of supply, which has declined for 32 straight months.  According to Lawrence Yun, NAR chief economist, “The utter lack of sufficient housing supply and its influence on higher home prices muted overall sales activity in much of the U.S. last month.” He added, “While the good news is that Realtors® in most areas are saying buyer traffic is even stronger than the beginning of last year, sales failed to follow course and far lagged last January’s pace. It’s very clear that too many markets right now are becoming less affordable and desperately need more new listings to calm the speedy price growth.”

Stocks; however, rebounded on the Flash PMI report on US manufacturing and Services from Markit Economics. 

• Manufacturing 55.9 versus estimate 54.0
• Service 55.9 versus estimate 53.3

Highlights:

• Business activity accelerated at the fastest pace in over 2 years
• Staffing at the highest level since August 2015
• Outlook is the strongest since May 2015

The economy is on fire!

There is a bond auction that could spook the market if demand is too low, but I will also say, it’s great that the ten-year yield is edging higher toward that 3.0% yield. It needs to happen soon to get it out of the system and to debunk the idea that this will derail the rally in equities.

Lots of stuff is happening between now and the close, so we don’t want to force it, as we are largely pleased with the way positions are acting.

On that note, I have a fresh buy list and eager to get super aggressive very soon.