Instant view: New home sales rise in September, prices fall

Politics Reuters

COMMENTS:

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DAVID SLOAN, ECONOMIST, IFR ECONOMICS, A UNIT OF THOMSON REUTERS

"September new home sales with a 5.7% increase to 313k exceeded a consensus expectation of 300k and were the highest since April. Sales are going to have to pick up a lot more than this to have a significant effect on overall economic growth but there is some tentative evidence emerging that falling mortgage rates are providing some support to the housing market, with the NAHB homebuilders survey providing hope for October. Falling new home prices however show that the market remains soft."

ROGER VOLZ, DIRECTOR OF CASH EQUITIES AT BGC FINANCIAL IN NEW YORK

JACOB OUBINA, SENIOR ECONOMIST, RBC CAPITAL MARKETS, NEW YORK

"The number's a little bit better than expected but we have to put this number into context. It's a far cry from the high 1.4 million that existed during the peak of the real estate boom.

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"We don't expect this sector to rebound any time soon. And this 'better' number comes in on the back of more price declines."

MARKET REACTION:

STOCKS: U.S. stock index futures hold earlier gains.

BONDS: U.S. bond prices hold earlier losses.

FOREX: The dollar remained little changed versus the euro and yen.

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