US stocks hit another record high as housing starts surge

Markets rose on Friday.

The S&P 500 rose 0.4 percent to another record high, the STOXX Europe 600 rose 1.0 percent and the Nikkei 225 rose 0.5 percent.

US economic data released on Friday were mixed.

Industrial production fell 0.3 percent in December and the University of Michigans consumer sentiment index fell to 99.1 in January from 99.3 in December.

However, housing starts rose 16.9 percent in December, the fastest pace since 2006.

Mike Loewengart, vice president of investment strategy at E-Trade, said that the housing starts figure “blows expectations out of the water” and suggested that “it’s hard to argue that this expansionary phase can’t keep going”.

However, George Mateyo, chief investment officer at KeyBank, noted that the forward price-to-earnings ratio for the S&P 500 has reached 18.8, well above the historical average.

“We’re getting into thin air, so we might get a pullback,” Mateyo said.