>> Market Update
QUOTATION OF THE WEEK…“Housework can’t kill you, but why take a chance.” –Phyllis Diller, American comedian
INFO THAT HITS US WHERE WE LIVE… After dipping two months in a row, Pending Home Sales went up 0.9% in June–in all four U.S. regions. This National Association of Realtors (NAR) index of signed contracts on existing homes points to higher sales for July.
The NAR’s chief economist believes the worst of the supply crunch has possibly passed. And Realtor.com’s chief economist noted, “markets on both coasts and in the South reported inventory increases in July.”
The latest Case-Shiller Home Price Index stayed at a 6.4% annual gain for the second month in a row. So the rate at which home prices are rising seems to have stabilized for now.
BUSINESS TIP OF THE WEEK… Experts say the one trait that will set you apart from the competition is to over-deliver on value. Exceed the expectations of your customers, vendors, partners, employees and community, and you’ll give yourself a distinct competitive edge.
>> Review of Last Week
EARNINGS AND DATA SPIKE STOCKS… Hot on the heels of solid corporate earnings and decent economic data, the Dow and the S&P 500 scored their fifth weekly gain in a row, while the Nasdaq followed two weeks of losses with the biggest boost of the three.
July jobs was the key economic report, and although we got a less-than-expected 157,000 new Nonfarm Payrolls, upward revs to May and June yielded a net gain of 216,000. Unemployment ticked down to 3.9%, pretty impressive, since the labor force is up by 1.5 million the past year.
The Fed met and left rates alone, as predicted. Even better, their policy statement said recent economic activity is rising at a “strong” rate, upgraded from the “solid” rate they observed in June. ISM reads showed manufacturing and services sectors staying well into expansion territory.
The week ended with the Dow UP 0.1%, to 25463; the S&P 500 UP 0.8%, to 2840, and the Nasdaq UP 1.0%, to 7812.
Treasuries finished the week higher, helping mortgage bonds post modest gains. The 30YR FNMA 4.0% bond ended up .11, to $101.67. The national average 30-year fixed mortgage rate drifted up for the second week in a row according to Freddie Mac’s latest Primary Mortgage Market Survey. Remember, mortgage rates can be extremely volatile, so check with your mortgage professional for up-to-the-minute information.
DID YOU KNOW?… In June, residential construction starts scored a 4% monthly gain, while ADP and Moody’s Analytics reported 7,000 new construction jobs. Looks like the construction sector is moving up.
>> This Week’s Forecast
PRICES GROW SLOWLY… Inflation is big on the radar this week and it’s expected to rise by the Consumer Price Index (CPI) and Core CPI (excluding volatile food and energy prices). But the rate of gain remains mild, even on the wholesale front, by the Producer Price Index (PPI) and Core PPI.
>> The Week’s Economic Indicator Calendar
Weaker than expected economic data tends to send bond prices up and interest rates down, while positive data points to lower bond prices and rising loan rates.
Economic Calendar for the Week of Aug 6 – Aug 10
>> Federal Reserve Watch
Forecasting Federal Reserve policy changes in coming months…Wall Street’s betting the Fed will bump rates a quarter percent at the end of September, then leave them alone until we get another tick up at the end of the year. Note: In the lower chart, a 94% probability of change is only a 3% probability the rate will stay the same.
Current Fed Funds Rate: 1.75%-2.00%
Probability of change from current policy:
6060 North Central Exp #438
This post is an advertisement for Ron Schulz. The material provided is for informational and educational purposes only and should not be construed as investment and/or mortgage advice, or a commitment to lend. Although the material is deemed to be accurate and reliable, there is no guarantee of its accuracy. The material contained in this message is the property of Supreme Lending and cannot be reproduced for any use without prior written consent. This message is intended for business professionals only and is not intended for distribution to consumers or other third parties. The material does not represent the opinion of Supreme Lending. EVERETT FINANCIAL, INC. D/B/A SUPREME LENDING NMLS ID #2129 (www.nmlsconsumeraccess.org) 14801 Quorum Dr., #300, Dallas, TX 75254. 877-350-5225. Copyright © 2018. Not an offer or agreement. Information, rates, & programs are subject to change without prior notice. Not available in all states. Subject to credit & property approval. Not affiliated with any government agency. AZ Mortgage Banker License 0925918, AZ Principal Office: 25030 S 190th Street, Queen Creek, AZ 85142. Licensed by the Department of Business Oversight under the CA Residential Mortgage Lending Act License 4130655. CO Mortgage Company – Regulated by the Division of Real Estate. Delaware Lender License 10885. GA Mortgage Lender License 22114– Georgia Residential Mortgage Licensee. IL Residential Mortgage License MB.6760323-DBA1– Illinois Residential Mortgage Licensee. MA Mortgage Broker License MC2129. MA Mortgage Lender License MC2129. Licensed by the N.J. Department of Banking and Insurance – New Jersey Residential Mortgage Lender License. Licensed Mortgage Banker-NYS Department of Financial Service. NY Mortgage Banker License B501049. Ohio Mortgage Broker Act Certificate of Registration MB.804158.000. Ohio Mortgage Loan Act Certificate of Registration SM.501888.000. OR Mortgage Lending License ML-4265. Licensed Mortgage Banker by the PA Department of Banking – Pennsylvania Mortgage Lender License 45048. Rhode Island Licensed Lender 20142998LL.