Pending Home Sales Jump Most Since 2004, Manufacturing Still Healthy

- Pending Home Sales for June rose 5.0% versus estimates of a -.5% decline and a -3.7% decline in May.

- ISM Manufacturing for July fell to 53.8 versus estimates of 55.0 and a reading of 56.0 in June.

- ISM Prices Paid for July fell to 65.0 versus estimates of 67.0 and a reading of 68.0 in June.

BOTTOM LINE: Americans unexpectedly signed more contracts to buy previously owned homes in June, a sign that housing may be stabilizing, Bloomberg said. Economists expect housing to gradually exert less of a drag on the economy going forward. Pending home sales rose 8.6% in the West, 4.7% in the South, 3.5% in the Midwest and 3.1% in the Northeast. The 5.0% gains in Pending Home Sales was the largest since March 2004. I continue to believe home sales are stabilizing at relatively high levels and that housing-related fears are peaking right about now.

Manufacturing in the US expanded in July at close to the fastest pace in more than a year as factories received more orders from overseas, Bloomberg said. The ISM Manufacturing Index is still above long-term average levels. The Prices Paid component of the index fell to 65 from 68 the prior month. The New Orders component fell to 57.5 from 60.3 the prior month. The Inventory component of the index rose to 48.5 from 45.3 the prior month. Manufacturing will likely continue adding to overall US growth over the intermediate-term as companies gain more confidence in the durability of the current expansion and continue to rebuild depleted inventories.