According to the recent US pending homes sales report there was a rise during May 2011 in home sales. The US pending home sales index inclined by 8.2% during May 2011 compared with the April 2011 index. This index is a forward looking indicator and considers only the contracts signed and not closing.
This index might suggest a shift in direction in the US real estate market as this increase might indicate a recovery.
According to the work done by Roache et. al (2008) there might be a lag effect of the news related to changes in existing home sales on commodities prices including crude oil prices; in the paper it was shown that “good news” on home sales had a positive and significant effect on crude oil prices the following day. If this research has merit, we may see crude oil prices inclining not only today, but also tomorrow.
Current Nymex crude oil price, short term futures (July 2011 delivery) is traded up by 2.23%, at $94.96 per barrel as of 19:53*.
Euros to USD is currently traded up at 1.4428 a 0.3942% increase as of 19:59*.
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