| This week stocks fell and interest rates rose to their highest levels since last November. Rates have increased steadily since the beginning of the year as economic data has shown that the economy is heating up and inflation has begun to rise since the start of the year. This week retail sales for March were announced. Consumers spent well over what experts had anticipated, another sign of the economy heating up. Several Fed members spoke this week. Investors now fear that it’s possible that there may be no rate cuts this year. In January experts expected four cuts in 2024. Oil prices dropped from last week’s highs as it appears that tensions between Israel and Iran are not going to spread into a larger conflict.
Stock markets – The Dow Jones Industrial Average closed the week at 37,986.49, unchanged from 37,983.24 last week. It is up 0.8% year-to-date. The S&P 500 closed the week at 4,967.23, down 3.1% from 5,123.41 last week. The S&P is up 4.2% year-to-date. The Nasdaq closed the week at 15,281.01, down 3.5% from 16,175.09 last week. It is up 1.8% year-to-date. U.S. Treasury bond yields – The 10-year treasury bond closed the week yielding 4.62% up from 4.50% last week. The 30-year treasury bond yield ended the week at 4.72%, up from 4.61% last week. We watch bond yields because mortgage rates follow bond yields. Mortgage rates – Every Thursday Freddie Mac publishes interest rates based on a survey of mortgage lenders throughout the week. The Freddie Mac Primary Mortgage Survey reported that mortgage rates for the most popular loan products as of April 18, 2024, were as follows: The 30-year fixed mortgage rate was 7.1%, up from 6.88% last week. The 15-year fixed was 6.39%, up from 6.16% last week. The graph below shows the trajectory of mortgage rates over the past year.
Freddie Mac was chartered by Congress in 1970 to keep money flowing to mortgage lenders in support of homeownership and rental housing. Their mandate is to provide liquidity, stability, and affordability to the U.S. Year-over-year home prices jumped almost 8% in March. – The California Association of Realtors reported that existing home sales totaled 267,470 in March, down 7.8% from 290,470 closed sales in February, and down 4.4% from a revised 279,700 homes sold on an annualized basis last March. There was a 2.6-month supply of homes on the market in March, down from a 3-month month supply of homes in February and up from a 2.1-month supply one year ago. T he statewide median price paid for a home in March was $854,490 up 7.9% from a revised median price of $793,260 last March. Have a great weekend! |
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