- UPS, Intel, GE fall heavily
- Morgan Stanley beats forecasts
- Housing starts beat forecasts, but permits miss
- Consumer confidence declines
Dow Jones: 0.15%
S&P 500: -0.16%
Markets were lacking direction on Friday morning as investors digested mixed economic data from the housing market and a surprise decline in consumer confidence.
It was also a busy day for corporate earnings; Intel and UPS were both providing a drag after disappointing investors with guidance, General Electric slumped after missing forecasts, while Morgan Stanley jumped after beating expectations.
The Dow Jones Industrial Average rose 0.15% early on; the Nasdaq was down 0.21%, while the S&P 500
was trading 0.16% lower.
Housing data comes in mixed; consumer sentiment weakens
US housing starts fell 9.8% over the month in December to reach an annualised rate of 999,000, according to the US Department of Commerce. This was a significantly pull-back from the revised 23.1% gain in November but still came in ahead of the consensus forecast of 990,000.
Putting last month's fall into context, Property Economist Paul Diggle from Capital Economics said: "It only reversed half of November's (upwardly revised) increase; starts are still up on this time last year and they are more than double their low point from 2009."
However, data today also showed that building permits - more closely-watched by analysts given that they are a forward-looking indicator of housing activity - dropped by a worse-than-expected 3% during December to 986,000, coming in below the 1.014m prediction.
The preliminary reading of the University of Michigan consumer confidence index unexpectedly fell from 82.5 to 80.4 in January, surprising analysts who had expected a rise to 83.5.
Meanwhile, industrial production increased by 0.3% in December, as expected. Manufacturing output expanded by 0.4%, ahead of the 0.3% rise predicted.
Intel, UPS and GE fall; Morgan Stanley gains
Microprocessor group Intel was a heavy faller early on after saying after the bell last night that no revenue growth is expected in 2014, with the struggling PC market affecting demand. Fourth-quarter profit, however, rose to $2.6bn from $2.5bn the year before on sales that rose to $13.83bn from $13.48bn.
Delivery firm UPS was in the red after lowering its guidance for 2013 due to a shorter-than-expected holiday shopping season. Despite an "unprecedented" surge in last-minute orders, the company said that a shorter peak season for deliveries and poor weather dampened results.
Conglomerate General Electric also declined despite a broadly in-line fourth-quarter with income rising 4.8%.
Banking group Morgan Stanley gained strongly after topping estimates despite a 70% drop in fourth-quarter profits due to weak fixed-income trading results, legal costs and expenses. Investors were also reacting to its updated strategic plan, in which is reiterated its target for return on equity to exceed 10%.