LIVE MARKETS-Housing starts rebound, industrial output heats up (for now)

Welcome to the home for real-time coverage of markets brought to you by Reuters reporters. You can share your thoughts with us at markets.research@thomsonreuters.com

HOUSING STARTS REBOUND, INDUSTRIAL OUTPUT HEATS UP (FOR NOW)

Groundbreaking on new American homes USHST=ECI surged by 11.2% in February to 1.501 million units at a seasonally adjusted, annualized rate (SAAR).

That's 8.8% more than the 1.380 million units SAAR analysts were expecting.

Below the Commerce Department's headline, single-family projects - which account for the lion's share of the total - surged 11.4%, while multiple-unit starts jumped 10.7%.

On the other hand, building permits USBPE=ECI - considered one of the housing market's more forward-looking indicators - dropped 1.2% to 1.456 million units SAAR, or a mere 0.2% north of consensus.

Single-family and multiple unit permits dipped by 0.2% and 3.1%, respectively.

"February starts did show some signs of life," writes Carl Weinberg, lead economist at High Frequency Economics, who nevertheless warned the sector "is not yet in a 'recovery' by any measure."

"However, there is a hint of a bottom, at least in this weak sector," Weinberg adds.

Next, industrial output USIP=ECI increased by 0.7% last month according to the Federal Reserve, breezing past the 0.2% increase economists predicted.

Capacity utilization USCAPU=ECI, a measure of economic slack, unexpectedly ramped up to 78.2%, or 0.4 percentage points tighter than Street estimates and the strongest reading since June.

Even so, challenges and uncertainties persist.

"The March baseline anticipates even weaker industrial activity this year due to higher tariffs on China, Canada, and Mexico than previously thought," says Barnard Yaros, lead U.S. economist at Oxford Economics. "The industrial sector won't regain its stride until 2026 when the interest-rate loosening cycle will resume in full and North American tariffs will be largely removed."

Finally, the cost of goods imported to the United States USIMP=ECI (excluding tariffs) defied expectations by heating up 0.4% in February, per Labor Department Data.

Year-over-year, import prices are up a tidy 2%, the inflation rate targeted by Powell & Co.

However, import/export prices differ from other major inflation indicators in that things like currency exchange rates and foreign demand come into play.

Here's a chart that shows import/export prices against the dollar index, which tracks the greenback against a basket of world currencies.

(Stephen Culp)

*****

FOR TUESDAY'S EARLIER LIVE MARKETS POSTS:

WALL STREET SINKS WITH UNCERTAINTIES OVERSHADOWING DATA - CLICK HERE

NASDAQ COMPOSITE'S TRADABLE LOW, CAN IT LAST? - CLICK HERE

TIGHT GERMAN VOTE: "NO LESS THAN 489" - CLICK HERE

RECORD HIGH BUYBACKS HELPING UNDERPIN EUROPE - CLICK HERE

DAX TOPS THE CHARTS, GERMAN SMALLCAPS EVEN BETTER - CLICK HERE

BEFORE THE BELL: EUROPEAN FUTURES RISE, END OF SELL SIGNAL - CLICK HERE

ALL EYES ON TRUMP-PUTIN TALK, AND THEN ON CENBANK DELUGE - CLICK HERE