Taper fades with US consumer

The roller coaster taper ride continues with another night of fading expectations on mixed data. First, November Conference Board Consumer Confidence missed (chart from ZH):

The Conference Board Consumer Confidence Index, which had decreased sharply in October, declined again in November. The Index now stands at 70.4 (1985=100), down from 72.4 in October. The Present Situation Index edged down to 72.0 from 72.6. The Expectations Index declined to 69.3 from 72.2 last month.

It has erased much of its 2013 gains and shows ongoing damage from the government shutdown despite the October resolution. The up trend is intact, however.

More positive was Case Shiller house prices which showed still strong year on year gains (chart from CR):

Data through September 2013, released today by S&P Dow Jones Indices for its S&P/Case-Shiller Home Price Indices … showed that the U.S. National Home Price Index rose 3.2% in the third quarter of 2013 and 11.2% over the last four quarters.In September 2013, the 10- and 20-City Composites gained 0.7% month-over-month and 13.3% year-over-year. While 13 of 20 cities posted higher year-over-year growth rates, 19 cities had lower monthly returns in September than August.“The second and third quarters of 2013 were very good for home prices,” says David M. Blitzer, Chairman of the Index Committee at S&P Dow Jones Indices. “The National Index is up 11.2% year over- year, the strongest figure since the boom peaked in 2006. The 10-City and 20-City Composites year-over-year growth at 13.3% was their highest annual numbers since February 2006.”

Remember that Case Shiller is a three month moving average so this is really July-September. It is at its peak now and will decline sharply from here.

Finally, we had housing permits for October which were strong but nearly all in units (chart from CR):

Privately-owned housing units authorized by building permits in October were at a seasonally adjusted annual rate of 1,034,000. This is 6.2 percent above the September rate of 974,000 and is 13.9 percent above the October 2012 estimate of 908,000.Single-family authorizations in October were at a rate of 620,000; this is 0.8 percent above the September figure of 615,000. Authorizations of units in buildings with five units or more were at a rate of 387,000 in October.

The Richmond Fed manufacturing index also rebounded from the shutdown in November from 1 to 15.

But it was the consumer that held sway over markets. The Dow and S&P surged to new record highs. Long bonds were heavily bid and yields tumbled 1.3% to 3.78% on the 30 year. The US dollar fell one third of a percent but gold was stable.

Another evening of taper off, risk on and whoever said RoRo is dead needs his head read.