Housing starts slumped 16.5% in April, the most since February 2011, the Commerce Department reported. Manufacturing in the Philadelphia region unexpectedly contracted in May for the first time in three months as new orders retreated and factories cut back on employment and hours.
The market’s rally has pushed 193 stocks in the Standard & Poor’s 500 Index, or 39% of the index, to their highest levels in at least 52 weeks, the most in Bloomberg data going back to 1993. The cumulative advance-decline line for stocks listed on the New York Stock Exchange, representing the number of daily gains minus declines, reached a record 63,856 yesterday.
Gains accelerate when corporate profits and the economy surprise a market dominated by skepticism, according to Laszlo Birinyi, president of Westport, Connecticut-based Birinyi Associates Inc. and among the first to advise buying U.S. stocks before the bull market began in 2009. He reiterated that the S&P 500 may climb 15% to 1,900 should it conform to bull markets that began in 1982 and 1990.
“Everything is going up, it’s not just tech or industrials or dividends,” Birinyi said today in an interview with Francine Lacqua and Guy Johnson on Bloomberg Television in London. “It’s not just central banks. Earnings are good, the psychology is people are fighting the tape,” he said. “Basically the psychology is, ‘I missed it.’”
The Chicago Board Options Exchange Volatility Index, or VIX, rose 2% to 13.07. The equity volatility gauge, which moves in the opposite direction to the S&P 500 about 80% of the time, has slipped 27% this year.
Nine out of 10 groups in the S&P 500 retreated today, with health-care and consumer discretionary shares dropping at least 0.9%.