Pending home sales post surprise increase in May Pending home sales, a measure of signed contracts on existing homes, rose slightly in May, up 0.7% compared with April, according to the National Association of Realtors, breaking a six-month streak of declining demand. Analysts polled by the Wall Street Journal had forecast a 4% drop. On an annual basis, they were down 13.6%. Regionally, pending home sales rose 15.4% in the Northeast compared with last month and were down 11.9% from May 2021. In the Midwest sales fell 1.7% for the month and were down 8.8% from a year ago. In the South, sales increased 0.2% month to month and were down 13.8% year over year. Sales fell hardest in the West, where homes are priciest, down 5.0% for the month and down 19.8% from the year before. “Despite the small gain in pending sales from the prior month, the housing market is clearly undergoing a transition,” NAR Chief Economist Lawrence Yun said. “Contract signings are down sizably from a year ago because of much higher mortgage rates.” “It’s a pretty small bounce after six straight declines, so it doesn’t change the story that the housing market is set for a more challenging year ahead due to poor affordability and expected slower job growth,” commented Sal Guatieri, senior economist at BMO Capital Markets. CNBC Market Watch Durable goods orders rose again last month Orders at U.S. factories for long-lasting goods such as new cars or heavy machinery rose 0.7% in May, a stronger than expected reading that showed manufacturers still had plenty of demand for their products even amid signs the economy was slowing. Economists polled by the Wall Street Journal had forecast a 0.2% advance. It was the seventh gain in the last eight months. The value of core capital goods orders, a proxy for investment in equipment that excludes aircraft and military hardware, rose 0.5% after a 0.3% gain a month earlier. Orders for new cars and trucks rose 0.5% in May and offset a 1.1% decline in commercial airplanes. New orders also rose 0.7% outside the transportation segment, a large and volatile category that often exaggerates the ups and downs in industrial production. The also rose for machinery, electronics and communications gear. Orders were flat for fabricated-metal parts and they declined for computers. “From everything I have seen, business investment remains strong, though it certainly would not be surprising to see some moderation going forward as borrowing rates and uncertainty regarding the economic outlook rise,” said chief economist Stephen Stanley of Amherst Pierpont Securities. Bloomberg Market Watch