Inventories decline slightly after Home Depot's low revenues and a significant drop in housing starts

Shares fell on Tuesday as investors digested the weaker-than-expected release of Home Depot's results, mixed economic data and the testimony of the Fed's highest official.

Home Depot's fourth quarter adjusted earnings were $ 2.09 per share, lower than the expected profit of $ 2.16. The home improvement company also released lower than expected forecasts for 2019. These results resulted in a decline of approximately 0.88% in Home Depot shares.

Home Depot's results were followed by weaker than expected data on housing starts. Data released by the Department of Commerce show that housing starts fell 11.2% in December and hit their lowest level since September 2016.

The data is old and "does not reflect enough time for consumers to react to lower mortgage rates," said Peter Boockvar, chief investment officer at Bleakley Advisory Group. "That said, weekly data on MBA shopping purchases showed no real rebound in response to lower mortgage rates."

House prices also rose in December at their slowest pace in August 2015, revealed the S & P Case-Shiller index.

Strong consumer confidence has helped stocks recover some of their losses. The Conference Board said its consumer confidence index climbed to 131.4 in February, easily exceeding an estimate of 124. In January, consumer confidence was 121.7.