Economic Update For The Week Ending April 30, 2022

Stock markets fell for a fifth straight week – U.S. stocks suffered steep losses again on Friday to close out a brutal month. The Nasdaq had its worst month since 2008 as the technology stock sell-off continued. The Nasdaq is now in bear territory, down more than 20% for the year. The Dow and S&P 500 did not fare much better this week with the Dow plunging 939 points on Friday. The S&P had its worst month since March 2020 when the pandemic shutdown was enacted. Higher interest rates, higher fuel costs, supply shortages, and higher employment costs have investors feeling that earnings, while strong in the first quarter, will be lower in the future. The Dow Jones Industrial Average closed the week at 32,977.21, down 2.5% from 33,811.40 last week. It’s down 9.25% year-to-date. The S&P 500 closed the week at 4,131.93, down 3.3% from 4,271.78 last week. The S&P is down 13.3% year-to-date. The NASDAQ closed the week at 12,334.64, down 3.8% from 12,839.29 last week. It is down 21.2%, year-to-date. 

U.S. Treasury bond yields – The 10-year treasury bond closed the week yielding 2.89%, unchanged from 2.90% last week. The 30-year treasury bond yield ended the week at 2.96%, unchanged from 2.95% last week. We watch bond yields because mortgage rates often follow treasury bond yields. 

Mortgage rates – Home mortgage rates have continued to increase. Freddie Mac Primary Mortgage Survey reported that mortgage rates as of April 28, 2022 for the most popular loan products were as follows: The 30-year fixed mortgage rate was 5.10%, unchanged from 5.11% last week. The 15-year fixed was 4.40% almost unchanged from 4.38% last week. The 5-year ARM was 3.78%, almost unchanged from 3.75% last week.