Stocks have erased all early gains and are negative today as a couple different economic data points were released and were lower than expected.
The Chicago PMI hit its lowest level since August. The Chicago PMI is a measure of business activitiy in the Midwest. The reading fell to to 60.2 after hitting 62.2 in December. Many analysts were expecting a reading of 63. David Sloan with IFR Economics had this to say about the data, “January’s Chicago PMI reading of 60.2 compares to 62.2 in December and a market consensus of 63.0, but remains quite healthy.” Sloan continued, “Firmer data from other surveys appear to be catching up with the Chicago PMI. Internals were generally somewhat softer with the exception of a rise in delivery times.”
Consumer Confidence declined in January after two months of gains. The Consumer Confidence Index fell to 61.1, economists were expecting a reading of 68. A 90 indicates a healthy economy, which was last seen before the recession began.
Finally, the housing sector saw more bad news today as housing prices continue to fall. Single-family home prices in 20 cities fell 0.7%, higher than the 0.5% drop that was expected.
The stock market is reacting to this news today with the major indices all dropping about 0.5%.