“We’re home. Home! And this is my room, and you’re all here. And I’m not gonna leave here ever, ever again, because I love you all, and there’s no place like home!”

As you probably recognized, a young girl from Kansas uttered those words. The home also is dear to Wall Street’s heart.

Housing sector reports are leading indicators and as such, they get close scrutiny from investors. Leading indicators provide early hints of economic trends, and stock market analysts clamor for any signal as to what the future may hold.

Housing trends also exert a multiplier effect throughout the economy. The average American’s wealth has long been tied to home ownership.

But this week’s housing reports are a mixed bag. What are we to make of them?

Below, I interpret what the bad news/good news on housing could presage. I also steer you toward a safe haven that offers both income and growth, as well as a hedge against current uncertainty.

Let’s first look at new housing starts. Released monthly, the data gauge the number of privately owned new houses, both single family and multiple unit homes and condos, on which construction has begun in a given period.

The Commerce Department reported Tuesday that U.S. homebuilding declined in September and permits dropped to a one-year low, amid chronic shortages of raw materials and labor. The implication is that economic growth slowed in the third quarter.

Housing starts fell 1.6% to a seasonally adjusted annual rate of 1.555 million units last month, the lowest level since April. The consensus expectation was that starts would rise to a rate of 1.620 million units (see chart).

Weighing on housing starts have been supply chain disruptions, which are pushing up the costs of raw materials (especially for copper and lumber). The nation’s ports are clogged with lines of ships waiting to unload, causing widespread shortages.

But investors remain optimistic, as jobs growth strengthens and consumers boost retail sales. On Thursday, the Dow Jones Industrial Average slipped 6.26 points (-0.02%), but the S&P 500 rose 13.56 points (+0.30%) to close at a record high. The NASDAQ rose 94.02 points (+0.62%), and the Russell 2000 climbed 6.42 points (+0.28%).

The housing market also gave us encouraging news this week.

The National Association of Realtors reported Thursday that sales of existing homes soared 7% to a seasonally adjusted annualized rate of 6.29 million units in September (see chart).

The median existing-home sales price rose 13.3% year-over-year to $352,800. Every region of the U.S. experienced increases on a month-over-month basis in September.

After the opening bell Friday, the major U.S. stock indices were mixed as investors digested contradictory economic data. The tech-heavy NASDAQ was trading in the red, amid a few negative earnings surprises from Big Tech.

Follow the yellow brick road…

The economic recovery is intact but, as I’ve just explained, it’s uneven due to pandemic-induced disturbances. We probably face more mixed news ahead, and with it stock market volatility.

Where can you find steady growth and income? Consider the classic safe haven of electric utilities. Despite rising interest rates, the utility sector still shows appeal.

Read This Story: Will The Fed Miss The Mark?

I think Treasury rates will rise only modestly in Q4 and early 2022. Federal Reserve Chair Jerome Powell has voiced concerns about continued weak economic indicators and he doesn’t want to reverse the recovery by tightening too much, too soon.

The Fed is on the verge of tapering its asset purchases, but has indicated it will wait until 2023 to hike its policy rates. If inflation gets too hot, there’s the risk that the Fed may hike rates sooner. That said, investors sometimes overlook total return performance in the utilities sector that can be as high as 10% or more (dividend plus price appreciation).

That means utilities remain quite competitive over the long haul, regardless of what the Fed does. What’s more, a strengthening economy leads to increased electricity demand and better earnings.

Utilities provide essential services, a virtue that tends to make their stocks resistant to setbacks in the economy. These dividend-payers are the yellow brick road for smart investors. For the best utilities stocks to buy now, click here.

John Persinos is the editorial director of Investing Daily. He also edits our premium publication, Utility Forecaster. Subscribe to his video channel.