The Freddie/Fannie effect seems to be fading. Disappointing US home sales have sent Wall Street and the London market into the red.
The Dow Jones industrial average is now down nearly 40 points, while the FTSE 100 is 25.9 points lower at 5420.4.
Pending home sales, based on contracts signed in July, fell 3.2% month on month after jumping 5.8% in the previous month. Analysts had been expecting a 1% decline.
"Supply is still twice the long term average, leaving little doubt that the US housing market is still very weak," said Dimitry Fleming at ING Bank. Hence the Freddie and Fannie problems of course.
