Existing Home Sales Up; ECB Gives Cypress a Deadline; Unemployment Claims Edge Up

The National Association of Realtors reported on Thursday that total existing home sales were up in February 0.8 percent to an annualized rate of 4.98 million units. The February 2013 level was 10.2 percent higher than the same month a year earlier.

Distressed homes, which includes foreclosures and short sales, accounted for 25 percent of February sales, up from 23 percent in January but down from 34 percent in February 2012, according to NAR. Investors are active buyers, but not dominant force in the market. They account for most cash sales, and bought 22 percent of homes in February, up from 19 percent in January; some 23 percent of homes were sold to investors in February 2012.

The Realtors also said that the inventory of existing homes nationwide was up 9.6 percent month over month in February to 1.94 million units, but the figure isn’t seasonally adjusted, and reflects the fact that inventories are always up early in the year. Compared with this time last year, inventory was down 19.2 percent, which is still a positive housing trend. In February, there was 4.7 months of inventory, compared with 4.3 months in January, which was lowest month for inventory since well before the recession.

ECB Give Cypress a Deadline

The European Central Bank issued a statement on Thursday essentially setting a deadline for Cyprus to take action of some kind on its bailout, which the country’s parliament rejected because of the now-notorious savings account tax for all depositors in Cypriot banks. “The Governing Council of the European Central Bank decided to maintain the current level of Emergency Liquidity Assistance (ELA) until Monday, 25 March 2013,” the statement said, referring to the financial lifeline in the form of low-interest lending currently supporting the Bank of Cyprus.

A vote on a revamped bailout deal was slated for Thursday in parliament, but put off for a day. The new deal did not include the reviled deposit tax. The finance ministers of the EU issued a statement on Thursday that declared they were “conditionally satisfied” with the revised deal. In the meantime, exasperated Cypriots were reportedly doing a modern equivalent of a run on their banks: lining up to withdraw as many euros as possible from ATMs.

Closer to home, the U.S. House of Representatives voted to avoid the fuss involved with a federal government shutdown by passing the Senate-approved continuing resolution 318-109 to fund the government until September. The law also included measures to give the military and some agencies more flexibility in applying the cuts mandated by sequestration (and keeps those meat inspectors on the job).

Unemployment Claims Edge Up

The U.S. Department of Labor said on Thursday that for the week ending March 16, initial unemployment claims were 336,000, an increase of 2,000 from the previous week’s revised figure of 334,000. The four-week moving average was 339,750, a decrease of 7,500 from the previous week, reflecting the substantial drops in the last few weeks.

Wall Street had a down day on Thursday, with the Dow Jones Industrial Average down 90.24 points, or 0.62 percent. The S&P 500 lost 0.83 percent and the Nasdaq was off 0.97 percent.