Case-Shiller reports surprising weakness in home prices, at minus 0.2 percent in May. Year-on-year, prices are flat at plus 4.9 percent which is 3 tenths below the low estimate. The data include a sizable downward revision to April which is now unchanged from an initial gain of 0.3 percent.

Declines are widespread, hitting 12 of 20 cities including a second straight decline, at a steep minus 0.7 percent in May, for the usually very strong San Francisco. Chicago, down 0.9 percent in the month, is also down for two straight months. Year-on-year, Denver is out in front at plus 10.0 percent followed by San Francisco at plus 9.7 percent and Dallas at plus 8.4 percent. Washington DC is at the bottom of the list at plus 1.3 percent and Cleveland at plus 1.6 percent.

This report contrasts a bit with the FHFA house price report where prices have continued to climb, though slowly, and where the year-on-year rate for May is slightly stronger at plus 5.7 percent. But together, they point to price concessions which likely helps explain the solid strength of existing home sales in May and June.