Sales of new single-family houses in the United States soared 8.8% month-over-month to a seasonally adjusted annualized rate of 693K in March 2024, the highest level in six months, and rebounding from an upwardly revised 5.1% drop in February. It compares with market forecasts of 668K, with demand remaining robust despite elevated mortgage rates. Sales jumped in the Northeast (27.8% to an annualized rate of 46K), the West (8.6% to 177K), the South (7.7% to 391K) and the Midwest (5.3% to 79K). The median price of new houses sold in the period was $430,700, while the average sales price was $524,800. Meanwhile, there were 477K new homes listed for sale during the period, representing about 8.3 months of supply at the latest sales rate.

Stocks in the US gained for a second session on Tuesday, with the S&P 500 rising 1%, the Dow Jones adding 200 points and the Nasdaq increasing 1.4%, as the earnings season rolls in. Communication services, industrials and health were the top performing sectors while materials and energy underperformed. On the corporate front, shares of Danaher soared about 6.5% after the company beat on both earnings and revenue. UPS was up nearly 2.1% after posting better-than-expected earnings. Also, Lockheed Martin gained 2.1% after reporting a rise in sales led by missiles, air-defense systems and space hardware. General Motors jumped 2.8% following an earnings beat and raised profit outlook. PepsiCo however, fell 2.2% as its results failed to impress investors. Tesla (-0.3%) and Visa (0.7%) are both set to release quarterly results after the closing bell. On the data front, the S&P Global Services and Manufacturing PMIs indicated an unexpected slowdown in US manufacturing and services.

The composite manufacturing index in the US Fifth District area increased to -7 in April from -11 in March, as expected. Shipments (-10 vs -14 in March) and new orders (-9 vs -17) increased while employment fell (-2 vs 0). Firms continued to report declining backlogs and vendor lead times in April, as those indexes increased but remained negative. The capacity utilization index rose to -5 from -21. Also, firms were more optimistic about local business conditions (6 vs-1). The average growth rate of prices paid decreased in April, while the average growth rate of prices received edged up slightly. Looking ahead, future local business conditions rose (16 vs 12), as the future indexes for shipments and new orders rose notably, suggesting that firms expect improvements in these areas over the next six months.

The dollar index dropped below 105.7 on Tuesday after data showing a slowdown in US manufacturing and services sectors boosted expectations for interest rate cuts. The US private sector saw only slight growth, the weakest since December, according to S&P Global. Both manufacturing and services sectors experienced slower activity with growth rates hitting three- and five-month lows. Still, most investors anticipate only two rate cuts this year with the first drop in borrowing costs coming in September. Investors are now waiting for US GDP data on Thursday and the Fed's PCE price index report on Friday for additional insights.

The HCOB Eurozone Composite PMI rose to 51.4 in April 2024, up from 50.3 in the previous month and above the market expectation of 50.8, a preliminary estimate showed. The latest reading signals a second successive month of rising output, which was the fastest since May 2023, with service sector output increasing the most in 11 months. On the other hand, manufacturing production continued to contract, although at the slowest rate in one year. By country, Germany returned to growth, ending a nine-month period of contraction, and France recorded the weakest pace of output decline in 11 months. Inflows of new orders remained under pressure due to sharp declines in factory demand, while employment levels increased the most since last June. On the price front, both input costs and output charges rose at a faster pace in April. Looking ahead, business expectations about the coming 12 months cooled slightly compared to March but was the second-highest recorded over the past 14 months.

The HCOB Germany Composite PMI rose to 50.5 in April 2024 from 47.7 in the previous month, easily beating market expectations of 48.6, a preliminary estimate showed. The latest reading was above the 50.0 no-change threshold for the first time since June 2023, signaling a modest rate of expansion in private sector business activity, led by a sharp rebound in service sector output. However, manufacturing production continued to contract, although at a slower pace. Total new business and backlogs of work contracted the least in nearly a year, while employment increased fractionally following a decrease the month before. On the price front, both input costs and output charges rose at a faster pace. Finally, overall business confidence ticked down slightly, as the degree of optimism in the service sector cooled from March’s 25-month high.