Economic update for the week ending October 10, 2020

Stock markets had their best week in three months – It was a strange week on Wall Street. Stocks opened the week higher as Treasury Secretary  Mnuchin has begun to bridge the gap between democrats and republicans on another round of stimulus. Stocks dropped midweek after President Trump announced that there would not be a stimulus bill passed until after the election. The following day he announced that a deal was close, and the White House increased their stimulus package from $1.6 trillion to $1.8 trillion. The House had approved a package for $2.2 trillion. Investors feel that a deal is close and stocks rallied on the prospect of approximately $2 trillion added to the economy. The Dow Jones Industrial Average closed the week at 28,586.90, up 3.3% from 27,681.71 last week. It’s down 0.2% year-to-date. The S&P 500 closed the week at 3,477.13, up 3.8% from 3,384.44 last week. It’s up 7.6% year-to-date. The NASDAQ closed the week at 11,579.94, up 4.6% from 11,075.02 last week. It’s up 29.1% year-to-date.

U.S. Treasury bond yields – The 10-year treasury bond closed the week yielding 0.79%, up from 0.70% last week. The 30-year treasury bond yield ended the week at 1.58%, up from 1.48% last week.

Mortgage rates – The October 8,  2020, Freddie Mac Primary Mortgage Survey reported mortgage rates for the most popular loan products as follows: The 30-year fixed mortgage rate average was 2.87%, unchanged from 2.88% last week. The 15-year fixed was 2.37%, unchanged from 2.36% last week. The 5-year ARM was 2.89%, unchanged from 2.90% last week.

September home sales figures should be released either at the end of next week or the beginning of the following week. Those results will appear in upcoming updates.