Economic update for the week ending December 15, 2018

New York Stock Exchange

Stocks ended the week down 

Signs of a slowing economy in Asia and Europe wiped out gains earlier in the week as stocks fell 2% on Friday. Earlier in the week it looked like stocks would end the week higher as investors  felt more optimistic that a trade deal would be worked out with China after President Trump tweeted that progress has been made, and talks with China have been productive. An inflation report showed inflation in check which lowers the risk of higher interest rates. Unfortunately, Friday’s repots that showed weakness in Asia and Europe wiped out the earlier weekly gains, and stocks had another losing week. The Dow Jones Industrial Average closed the week at 24,100.51, down from 24,338.94 last week. It was down 1.2% for the week and is now down 2.5% year-to-date.  The S&P 500 closed the week at 2,599.95, down  from 2,633.08 last week. It was down 1.3% for the week and is down 2.8% year-to-date. The NASDAQ closed the week at 6,910.77, down from 6,969.25 last week.   It was down 08% for the week and down 0.1%  year-to –date. 

Treasury Bond Yields unchanged 

The 10-year treasury bond closed the week yielding 2.89%, up slightly from 2.85%  last week. The 30-year treasury bond yield ended the week at 3.14%, unchanged from 3.14% last week. We watch treasury bond yields because mortgage rates follow bond yields. 

Mortgage rates dropped to the lowest level in three months 

The December 13, 2018 Freddie Mac Primary Mortgage Survey reported that the 30-year fixed mortgage rate average was 4.63%, down from 4.75% last week. The 15-year fixed was 4.07%, down from 4.21%  last week. The 5-year ARM was 4.04%, down from 4.07% last week. Rates ended the week even lower. 

Economic update for the month ending October 31, 2018

U.S. Employers added 250,000 new jobs in October:

Wages grow at fastest pace in almost 10 years – Unemployment remains at lowest rate since 1969 – The Department of Labor Statistics reported Friday that 250,000 new jobs were added in October. That eclipsed the 190,000 new jobs analysts had expected. Job growth has now hit a record of 97 straight months. The unemployment rate was unchanged at 3.7%, the lowest national unemployment rate in 49 years. Average hourly wages were up 3.1% in October from last October. That was the largest year over gain in almost 10 years. 


California employers added 13,200 new jobs in September :

The California Employment Development Department reported that 13,200 new jobs were added in September. California has now added an average of 29,400 new jobs a month for 103 consecutive months. The state’s unemployment rate dropped to 4.1%, the lowest rate on record. 


U.S. stocks saw their largest monthly loss in 10 years in October:

 Although most companies reported quarterly profits that beat or were in line with expectations, the few like Amazon, Square, Hasbro, Domingo’s  and others  that reported disappointing results scared investors. The Dow Jones Industrial Average closed the month at 25,115.76, down from 26,458.31. last month. The S&P 500 closed the month at 2,711.74, down from 2,913.98 on September 30The NASDAQ closed the month at 7,305.90, down from 8,046.35 last month.   


Treasury Bond Yields rise:

The 10-year treasury bond closed the month yielding 3.05%, up from 2.86% on August 31, 2018. The 30-year treasury bond yield ended the month at 3.19%, up from 3.02% at the end of August. 

Mortgage rates higher in October:

 The November 1, 2018 Freddie Mac Primary Mortgage Survey reported that the 30-year fixed mortgage rate average was 4.83%, up from 4.72% on September 27, 2018The 15-year fixed was 4.23%, up  from 4.16% on September 27.  The 5-year ARM was 4.04%, up from 3.97% at the end of September. 


GDP up 3.5% in third quarter:

The U.S. Bureau of Economic Analysis announced that the first reading of the nation’s gross domestic product (GDP) rose by 3.5% in the third quarter of 2018.   That beat expectations of a 3.4% rise, but was well below the 4.2% increase registered in the second quarter of 2018. The report also said that The PCE price index, a key indicator of inflation, rose at a 1.6% annual rate in the quarter. That was well below the 2.2% annual increase analysts forecasted. Consumer spending, which accounts for about two thirds of the U.S. economy grew by 4% in the third quarter. That marked the largest increase since the fourth quarter of 2014. 


September Nationwide Existing Home Sales:

 Data released this week from The National Association of Realtors showed that total existing home sales fell again in September. The number of existing homes sold in September fell 3.4% from August, and are down  4.1%  from one year ago. The median price paid for a home in The U.S. was up 4.2% from last September. That marked the 79th straight month of year over increases. The unsold inventory index is at a 4.4 month supply, up slightly form a 4.2 month supply one year ago. 


September California Existing Home Sales:

The California Association of Realtors reported that existing single family home sales totaled 382,550 in September on a seasonally adjusted annualized rate. That was down 4.3% from August and down a staggering 12.4% from last September, when sales totaled 436,920 on a seasonally adjusted annualized rate. The median price paid for a home in California was $587,850, up 4.2% from September 2017.On a more regional level the median price increased 4.7% in Los Angeles County10.6% in Ventura County, and 3.3% in Orange County from one year ago. Inventory levels continued to rise after hitting historic lows in 2017. The unsold inventory index in California stood at a 4.2 month supply in September, up from a 3.3 month supply in September 2017. Inventory levels have now increased for 6 straight months and are up 20.4% from one year ago. Listings are at the highest level in 31 monthsLos Angeles County has a 4.4 month supply, up from a 3.1 month supply last September. Orange County has a 4.3 month supply,  up  from 3.1 months last September. Ventura County had a 6.3 month supply of homes, up from a 4.7 month supply one year ago. 

Best,
Syd Leibovitch 
Rodeo Realty Inc.
9171 Wilshire Blvd. Suite 321
Beverly Hills, California 90210
CA DRE # 00858724

Economic update for the week ending October 27, 2018

Stocks suffer a turbulent week:

A positive GDP report showing that the economy grew at 3.5% in the third quarter, inflation was tame, and consumer spending was up, could not keep the markets from continuing to slide. This week. third quarter profits were reported that were below expectations. Those were mostly in the technology sector. Even Amazon did not hit their numbers. On the other hand, some companies like Ford and Tesla exceeded expectations. All in all, fears in the technology sector hit the NASDAQ hard. It lost 3.8% for the week and is now up just  3.8% for the year after being up 20% for the year just one month ago. The Dow and S&P also got hit hard down 3% and 3.9% respectively for the week. The Dow Jones Industrial Average closed the week at 24,688.31, down from 25,444.34 last week. It is down 0.1% year-to-date.  The S&P 500 closed the week at 2,658.69, down from 2,767.78 last week.  It’s down 0.6% year-to-date. The NASDAQ closed the week at 7,167.21, down from 7,449.03 last week.  It’s up 3.8% year-to-date.

Treasury Bond Yields lower this week:

The 10-year Treasury bond closed the week yielding 3.08%, down from 3.20% last week. The 30-year Treasury bond yield ended the week at 3.32%, down from 3.38% last week. We watch treasury bond yields because mortgage rates follow bond yields.

Mortgage rates almost unchanged this week:

The October 25, 2018 Freddie Mac Primary Mortgage Survey reported that the 30-year fixed mortgage rate average was 4.86%, almost unchanged from 4.85% last week. The 15-year fixed was 4.29%, slightly up from 4.26% last week. The 5-year ARM was 4.14%, up from 4.10% last week.

GDP up 3.5% in third quarter:

The U.S. Bureau of Economic Analysis announced that the first reading of the nation’s gross domestic product (GDP) rose by 3.5% in the third quarter of 2018.  That beat expectations of a 3.4% rise, but was well below the 4.2% increase registered in the second quarter of 2018. The report also said that The PCE price index, a key indicator of inflation, rose at a 1.6% annual rate in the quarter. That was well below the 2.2% annual increase analysts forecasted. Consumer spending, which accounts for about two thirds of the U.S. economy, grew by 4% in the third quarter. That marked the largest increase since the fourth quarter of 2014.

September Nationwide Existing Home Sales:

Data released this week from The National Association of Realtors showed that total existing home sales fell again in September. The number of existing homes sold in September fell 3.4% from August, and are down  4.1%  from one year ago. The median price paid for a home in the U.S. was up 4.2% from last September. That marked the 79th straight month of year over increases. The unsold inventory index is at a 4.4 month supply, up slightly from a 4.2 month supply one year ago. 

September California Existing Home Sales:

The California Association of Realtors reported that existing single family home sales totaled 382,550 in September on a seasonally adjusted annualized rate. That was down 4.3% from August and down a staggering 12.4% from last September, when sales totaled 436,920 on a seasonally adjusted annualized rate. The median price paid for a home in California was $587,850, up 4.2% from September 2017. On a more regional level, the median price increased 4.7% in Los Angeles County, 10.6% in Ventura County, and 3.3% in Orange County from one year ago. Inventory levels continued to rise after hitting historic lows in 2017. The unsold inventory index in California stood at a 4.2 month supply in September, up from a 3.3 month supply in September 2017. Inventory levels have now increased for 6 straight months and are up 20.4% from one year ago. Listings are at the highest level in 31 months. Los Angeles County has a 4.4 month supply, up from a 3.1 month supply last September. Orange County has a 4.3 month supply,  up from 3.1 months last September. Ventura County had a 6.3 month supply of homes, up from a 4.7 month supply one year ago. 

Have a great weekend!
Syd

Economic update for the week ending October 13, 2018

New York Stock Exchange

Stocks have largest weekly loss since March – Stock markets ended higher on Friday after six straight losing sessions to end the week with the largest weekly loss in seven months. Investors feared rising interest rates, trade war concerns with China, and rising international pressures after the International Monetary Fund reduced its growth expectations for next year. Friday, a report showed that inflation grew less than expected, which calmed investors. Next week, third quarter earnings are going to begin to be reported. Analysts expect those to be up over 20% from last year. The Dow Jones Industrial Average closed the week at 25,339.99,  down from 26,447.05 last week. It is up 2.5% year-to-date.  The S&P 500 closed the week at 2,767.13, down from 2,885.57 last week. It’s up 3.5% year-to-date. The NASDAQ closed the week at 7,496.89, down from 7,788.45 last week. It’s up 8.6% year-to-date.

Treasury Bond Yields lower this week –  Bond yields dropped this week after reaching multi-year highs last week. The 10-year Treasury bond closed the week yielding 3.15%, down from 3.23% last week. The 30-year Treasury bond yield ended the week at 3.32%, down from 3.40% last week. We watch treasury bond yields because mortgage rates follow bond yields.

Mortgage rates at highest level in 8 years  – The October 11, 2018 Freddie Mac Primary Mortgage Survey reported that the 30-year fixed mortgage rate average was 4.90%, up sharply from 4.71%  last week. The 15-year fixed was 4.29%, up from 4.15% last week. The 5-year ARM was 4.07%, up from 4.01% last week. Bond yields dropped later in the week. Next weeks mortgage rates will be slightly lower.

Inflation tame in September – The consumer price index (CPI) rose just 0.1% for the month in September, and 2.3% from one year ago. That was below expectations of 0.2%, and 2.4%.

Have a great weekend!

Economic update for the month ending September 30, 2018

Economic update for the month ending September 30, 2018

U.S. Economy adds 134,000 new jobs in September – Unemployment rate dropped to the lowest level since 1969:

U.S. Department of Labor
U.S. Department of Labor

The Department of Labor Statistics reported that U. S. employers added 134,000 new jobs in September. That was below the 185,000 that analysts had estimated, yet even though job creation fell to its lowest level in a year the unemployment rate dropped to its lowest level in 49 years. The national unemployment rate in September was 3.7%, down from 3.9% in August. Average hourly wages rose 2.8% year over year from last September. That was slightly lower than last month when average hourly wages increased 2.9% from last August.

California employers add 44,800 new jobs in August:

The California Employment Development Department reported that 44,800 new jobs were added in August. The unemployment rate held steady at a record low of 4.2%, down from 4.6% last August. Average hourly wages  grew 3.1% year over year, their largest year over year increase since last October. Los Angeles and Orange County average hourly earnings grew 5.4% from last August. 

 Stock Market Update:

NYSE-NEW YORK, NY

The Dow Jones Industrial Average closed the month at 26,458.31, down from 25,964.62 last month. It is up 7% year to date. The S&P 500 closed the month at 2,913.98, down from 2,901.52 on August 31 It’s up 9% year to date. The NASDAQ closed the month at 8,046.35, down from 8,109.54 last month. It’s up 16% year to date.

Treasury Bond Yields rise: 

The 10-year treasury bond closed the month yielding 3.05%, up from 2.86% on August 31, 2018. The 30-year treasury bond yield ended the month at 3.19%, up from 3.02% at the end of August.

Mortgage rates higher in September: 

The September 27, 2018 Freddie Mac Primary Mortgage Survey reported that the 30-year fixed mortgage rate average was 4.72%, up from 4.52% on August 30, 2018. The 15-year fixed was 4.16%, up  from 3.97% in August 30. The 5-year ARM was 3.97%, up from 3.85% last month.

Consumer Confidence at highest level hits 18 year high in September:

The U.S. Consumer Confidence Index hit its highest level since 2000 this week according to data from the Conference Board’s September survey.

New home sales rebound in August:

The Commerce Department reported that sales of new homes increased 3.6% in August from July on a seasonally adjusted annualized rate. Year over year the number of new homes sold in August increased 12.7% from August 2017. The median price paid for a new home increased 1.9% from one year ago.

California existing home sales numbers drop in August – Prices continue to rise:

The California Association of Realtors reported this week that the number of existing home sales dropped in August to a seasonally adjusted annualized rate of 399,600. It was the fourth straight month of sales declines and the first time in over two years that the number of existing home sales dropped below the benchmark 400,000 level. The median price of a home in California rose to $596,410, up 6.6% from August 2017. On a regional basis the Los Angeles County median price rose 6.4%, Orange County rose 6,3%, and Ventura County rose 3.1% from last August. Housing inventory levels rose 17.2% from one year ago, the fifth straight month of housing supply increases. The unsold inventory index in August was a 3.3 month supply of homes listed for sale, up from 2.9 months in August 2017.

U.S. existing home sales:

The National Association of Realtors reported that total existing home sales equaled 5.34 million on a seasonally annualized rate, down 1.5% from August 2017. The nation wide median price grew 4.6% in August compared to one year ago marking the 78th straight month of year over year increases in the median price. Total housing inventory also increased. There was a 4.3 month supply of active listings in August, up from a 4.1 month supply in August 2017.

Have a great week!

-Syd

Economic Update for The Week Ending October 6, 2018

New York Stock Exchange

U.S. Economy adds 134,000 new jobs in September – Unemployment rate dropped to the lowest level since 1969 – The Department of Labor Statistics reported that U. S. employers added 134,000 new jobs in September. That was below the 185,000 that analysts had estimated, yet even though job creation fell to its lowest level in a year, the unemployment rate dropped to its lowest level in 49 years. The national unemployment rate in September was 3.7%, down from 3.9% in August. Average hourly wages rose 2.8% year-over-year from last September. That was slightly lower than last month when average hourly wages increased 2.9% from last August.

The Dow Jones Industrial Average closed the week at 26,447.05, down from 26,458.31 last week. It is up 7% year-to-date. The S&P 500 closed the week at 2,885.57, down from 2,913.98 last week. It’s up 9% year-to-date. The NASDAQ closed the week at 7,788.45, down from 8,046.35 last week. It’s up 16% year-to-date.

Treasury Bond Yields sharply higher than last week – The 10-year Treasury bond closed the week yielding 3.23%, up from 3.04% last week. The 30-year Treasury bond yield ended the week at 3.40%, up from 3.19% last week. We watch treasury bond yields because mortgage rates follow bond yields.

Mortgage rates higher at the end of the week – The October 4, 2018 Freddie Mac Primary Mortgage Survey reported that the 30-year fixed mortgage rate average was 4.71%, almost unchanged from 4.72% last week. The 15-year fixed was 4.15%, almost unchanged from 4.16% last week. The 5-year ARM was 4.01%, up from 3.97% last week. Although mortgage rates on Thursday’s survey were unchanged from last week’s rates they did rise in the end of the week. Next week’s survey rates will be higher.

Economic update for the week ending September 29, 2018

New York Stock Exchange

Stocks drop slightly in the final week of September – Stock markets fell slightly this week after hitting record highs last week. Escalating trade tensions with China and another interest rate hikes by the Federal Reserve left investors a little more cautious this week. The Dow Jones Industrial Average closed the week at 26,458.31, down from 26,743.50 last week. It is up 7% year-to-date.  The S&P 500 closed the week at 2,913.98, down from 2,929.67 last week. It’s up 9% year-to-date. The NASDAQ closed the week at 8,046.35, up from 7,986.96 last week. It’s up 16% year-to-date.

Treasury Bond Yields slightly lower –  The 10-year Treasury bond closed the week yielding 3.05%, down slightly from 3.07% last week. The 30-year Treasury bond yield ended the week at 3.19%, almost unchanged from 3.20% last week. We watch Treasury bond yields because mortgage rates follow bond yields.

Mortgage rates higher this week – The September 27, 2018 Freddie Mac Primary Mortgage Survey reported that the 30-year fixed mortgage rate average was 4.72%, up from 4.65%  last week. The 15-year fixed was 4.16%, up from 4.11% last week. The 5-year ARM was 3.97%, up from 3.93% last week.

Consumer Confidence at highest level hits 18-year high in September – The U.S. Consumer Confidence Index hit its highest level since 2000 this week, according to data from the Conference Board’s September survey.

New home sales rebound in August – The Commerce Department reported that sales of new homes increased 3.6% in August from July on a seasonally adjusted annualized rate. Year-over-year the number of new homes sold in August increased 12.7% from August 2017. The median price paid for a new home increased 1.9% from one year ago.

Have a great weekend!
Syd