Bonds get a break: What to watch for in real estate this week

Market Realist

Realist Real Estate Roundup, November 4–8 (Part 6 of 7)

(Continued from Part 5)

After a tumultuous couple of weeks, bonds get a break

This week is a short week with the bond market closed for Veteran’s Day. The stock market will still be open, however. It’s not a heavy week data-wise or earnings-wise.

Economic data this week

Monday, November 11

  • Veteran’s Day—Bonds closed, stocks open

Tuesday, November 12

  • NFIB Small Business Optimism
  • Chicago Fed National Activity Index

Wednesday, November 13

  • MBA Mortgage Applications
  • Monthly budget statement

Thursday, November 14

  • Initial jobless claims
  • Nonfarm productivity
  • Bloomberg Consumer Comfort
  • Unit labor costs
  • Trade balance
  • Bloomberg November United States Economic Survey

Friday, November 15

  • Import prices
  • Empire Manufacturing
  • Industrial production
  • Capacity utilization
  • Manufacturing production
  • Wholesale inventories
  • Wholesale trade sales

Earnings reports this week

Tuesday, November 12

  • D.R. Horton (DHI)
  • Springleaf Holdings (LEAF)

Wednesday, November 13

  • TriPointe Homes (TPH)

Impact on mortgage REITs

Mortgage REITs like Annaly (NLY), American Capital Agency (AGNC), and MFA Financial (MFA) are highly interest rate–sensitive. None of the economic releases will be market-moving (or at least none should be). For the REITs, next week will be all about whether Friday’s move in bonds is real or not. (Check out Part 7, where I discuss this issue.)

Impact on homebuilders

Homebuilders like Lennar (LEN) and KB Home (KBH) are heading into a seasonally weak period, so they’re in inventory reduction mode. We do hear from D.R. Horton (DHI) and Tri Pointe (TPH) next week, so that should bring some good data points. The builders will probably focus most closely on the industrial production and capacity utilization numbers, since these are leading indicators for manufacturing employment and jobs are a key driver for the builders at the moment.

Continue to Part 7

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