Shares of Citigroup (C 2.46%) are trading higher this afternoon, suggesting that investors are optimistic about tomorrow's release of housing data and the minutes from the Federal Reserve's most recent monetary policy meeting. With roughly two hours left in the trading session, Citigroup stock is up by $0.28, or 0.54%.
While there were no economic releases impacting banks today -- which goes a long way toward explaining why the KBW Bank Index (INDEX: ^BKX) is flat for all intents and purposes -- it's safe to say that the remainder of the week won't be similarly uneventful.
The pace should pick up tomorrow morning with the release of the National Association of Realtors' existing home sales index. Investors were disappointed by the data last month after it showed that sales of previously occupied homes had fallen by 0.6% in March to a seasonally adjusted annual rate of 4.92 million units. This go-around, economists are predicting the figure to come in higher, at 5 million units.
Also out tomorrow are the minutes from the Federal Reserve's monetary policy committee meeting, which took place at the end of last month. The big question will be whether the central bank will begin tapering its purchases of treasuries and mortgage-backed securities, which have driven long-term interest rates down to historic levels. Over the past two weeks, a number of Fed officials have expressed their opinions on the matter. On one side are the presidents of the Fed's Philadelphia and San Francisco branches, both of whom have called for reducing purchases. On the other side are presidents of the bank's Boston and St. Louis branches, who have come out in support of continuing the program.
And finally, on Thursday, the Commerce Department is set to release figures on new home sales from last month. Given that we're now firmly within the prime season to buy and sell a house, there will be significant interest on how this critical component of our economy is performing. And this is particularly true for banks like Citigroup, which look to mortgages to boost their top and bottom lines.
