James Dennin, Kapitall: Can we expect good news in construction spending when the government starts releasing data again?
Huzzah! The government shutdown is over. Washingtonians can grumble all they want about reporting for duty after an unrequested, soon to be paid, two week vacation.
Read more on housing from Kapitall: Chinese Housing Bubble: Will These Stocks Survive if it Bursts
It's probably a good thing that our government workers are back to getting things done, as opposed to just getting their drink on. And the shutdown didn't seem to have a big overall effect on the markets – a noticeable decline, but hardly the apocalyptic scenario some people were forecasting.However, while that would seem to be good news, part of the reason the markets didn't move much is because the government stopped reporting data on various sectors. Consumer confidence, unemployment claims, construction reports – all of them stopped coming out when the people who make those reports were put on furlough. And now, as the government re-opens, Business Insider is reporting that all of those juicy reports are going to come out at once. It's basically going to be like Christmas for statisticians and forecasters alike, especially if any of the reports contain good news. Investing ideas One of those could be the report on construction spending, which analysts at Citigroup (C) expect to have improved through August and the shutdown. Construction spending affects a number of industries tied to the housing sector, from builders to lumber companies to window manufacturers. We decided to run a broad screen on the housing sector, looking at a universe of about a hundred stocks related to construction and that could benefit from improved spending. To narrow down our list, we looked at which of these companies had experienced upswings in institutional buying. Institutional buying is significant because it tells us which stocks are being purchased by hedge funds, asset managers, mutual funds and the like. And it's always important to bear in mind who is buying the shares. Some companies and funds are a lot more discriminating than others, so we included the top holders for the 9 construction stocks on our list.
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