* Home resales fall 4.3 percent in November
* Jobless claims rise 10,000 in latest week
* Claims highest since March in payrolls survey week
* Mid-Atlantic factory activity regains speed in December
By Lucia Mutikani
WASHINGTON, Dec 19 U.S. home resales hit a near
one-year low in November and new filings for unemployment
benefits unexpectedly rose last week, putting a wrinkle in an
otherwise brightening economic picture.
The reports on Thursday came a day after the Federal Reserve
gave the economy a vote of confidence by announcing that it
would reduce its monthly $85 billion bond buying program by $10
billion starting in January.
"Things have not changed. It's still a marginally rosier
outlook in the short-term," said Jacob Oubina, senior U.S.
economist at RBC Capital Markets in New York.
The National Association of Realtors said sales of
previously owned homes fell 4.3 percent last month to an annual
rate of 4.90 million units. That was the lowest since December
last year and the third straight monthly drop.
A rise in interest rates since the spring and fast-rising
home prices have shut some potential buyers out of the market,
dampening home sales in recent months.
Economists polled by Reuters had expected home resales to
fall only to a 5.03 million-unit pace in November.
Housing market fundamentals, however, remain solid.
Household formation is rising steadily from multi-decade lows,
which in turn is keeping demand for housing supported and
encouraging builders to undertake new projects.
Median home prices increased 9.4 percent from a year-ago and
the share of distressed properties - foreclosed and short sales
- declined over the same period.
The inventory of previously owned homes on the market
slipped 0.9 percent to 2.09 million units, representing a 5.1
months supply at November's sales pace. That compared to 4.9
months' worth in October.
A 6.0 months' supply is normally considered healthy.
"We are starting to reach a point where we are seeing a
shift from a speculative investor driven recovery to one that is
going to be more represented by the traditional buyers and
sellers that make housing decisions based on lifestyle," said
Budge Huskey, chief executive officer at Coldwell Banker Real
Estate in Madison, New Jersey.
Stocks on Wall Street were little changed after rallying the
prior session. U.S. Treasury debt prices fell, while the dollar
rose against a basket of currencies.
In a separate report, the Labor Department said initial
claims for state unemployment benefits increased 10,000 last
week to 379,000, the highest level since March.
But other labor market indicators have pointed to a
strengthening in job growth, and economists discounted the data,
which covered the period for the government's December nonfarm
"The rise was likely due to year-end holiday seasonal
layoffs, which the government struggles to adjust properly at
this time of year," said Mei Li, an economist at FTN Financial
in New York.
"Nevertheless, claims will have to be watched closely in
coming weeks. If the rise does not quickly reverse it will be a
sign there is more going on."
A third report showing factory activity in the U.S.
mid-Atlantic picked up last month offered an upbeat signal on
labor market conditions. The rise in the Philadelphia Federal
Reserve Bank's business activity index was driven by gains in
employment measures and new orders.