Stocks flat for the week – The Dow Jones Industrial Average, S&P 500, and the NASDAQ reached all-time highs on Monday, before losing ground and ended the week almost unchanged. Oil strengthened which could help oil producing regions, and the dollar softened which could be good for exports if these trends continue. The Federal Reserve released its July meeting minutes on Wednesday, but there was little impact, as committee members gave no detail about when they plan to raise rates next. The committee left the door open for a September or December rate hike, but the minutes showed that members have mixed views on the employment and inflation trends, along with the impact Brexit will have, indicating that they will raise rates at a very slow pace. The Dow Jones Industrial Average closed the week at 18,552.57, down slightly from 18,576.47 last Friday. The S&P 500 closed the week at 2,183.87, almost unchanged from 2,184.05 last week. The NASDAQ closed the week at 5,238.38, almost unchanged from last week’s close of 5,232.90.
Bond yields slightly higher – The 10 year U.S. Treasury bond yield closed the week at 1.58%, up from 1.51% last Friday. The 30-year U.S. Treasury bond closed at 2.29%, up from 2.23% last week. Mortgage rates follow bond yields so we watch bond yields closely.
Mortgage rates remain near record lows – The Freddie Mac Primary Mortgage Survey released on August 18, 2016 showed that average mortgage rates from lenders surveyed for the most popular mortgage products were as follows: The 30-year fixed rate average was 3.43%. The 15-year fixed average rate was 2.74%. The 5/1 ARM average rate was 2.76%
California employers add 36,400 new jobs in July – The Employment Development Department reported that California’s employers added 36,400 new jobs in July. Although this was considered solid job gains by experts, the unemployment rate actually rose from 5.4% in June to 5.5% in July, as more workers entered the job search.
Number of existing homes sold in July drops as tight inventory puts a squeeze on sales – The California Association of Realtors reported that the number of existing homes sold in California declined 4.1% from June’s sales pace and 5.1% from last July’s annualized rate as historically low inventory levels dragged down sales. The statewide median price in July was $509,830 which was down 1.8% from June and up 3.9% from July 2016. The unsold inventory index edged up from a 3.2 month supply in June to a 3.6 month supply in July.
Have a great weekend!