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Market Update March 23
For the week of March 23, 2015 – Vol. 13, Issue 12>> Market UpdateQUOTE OF THE WEEK... "All that matters is if you can look in the mirror and honestly tell the person you see there, that you've done your best."--John McKay, American football coachINFO THAT HITS US WHERE WE LIVE... Of course, sometimes you do your best and the results come in a bit less than that. We're sure builders were doing their best in February, yet Housing Starts dropped a precipitous 17.0% to a disappointing 897,000 annual rate. The Negative Nellies in the media got all bent out of shape over this, but let's look at some of the other data during the month. Retail sales were down, but not Internet and mail order buying. Manufacturing numbers were off, but utility businesses did very well. Could it have been the weather? The fact is, this February logged the coldest temperatures for the most people since 1979. For 23 states, it was among the top-10 coldest Februarys since they started recording such things in 1895. In many areas of the country, it was nearly impossible to break ground. In spite of this, single-family starts are still up 0.7% in the past year. Builders remain optimistic going forward, as new Building Permits were up 3.0% in February, to a 1.092 unit annual rate, which solidly beat consensus expectations. Permits for single-family units are now up 2.8% versus a year ago. The National Association of Home Builders confidence index in March slipped to 53 from February's 55, but readings above 50 still show more respondents say conditions are good, rather than bad.BUSINESS TIP OF THE WEEK... Be relentless following up on leads and referrals. Plan the next steps to take with all your top prospects. Track your progress on a spreadsheet or wipe-off board. >> Review of Last WeekTHE FED RUNS THE ELEVATOR... The stock market went on an up and down elevator ride for the second week in a row, as it anticipated and then reacted to Wednesday's Fed meeting. With the central bank running the elevator, all three market indexes ended strongly up. The tech-heavy Nasdaq even hit its highest close in 15 years, finishing Friday above 5,000, just 0.4% off its all-time closing high on March 10, 2000. On Monday, stocks headed up, thanks to some disappointing manufacturing reads. Investors felt the Fed would be reluctant to raise rates, with Industrial Production, Capacity Utilization, and New York Empire Manufacturing all down in February.That reluctance was confirmed Wednesday when Fed Chair Janet Yellen revealed the central bank would raise interest rates more slowly than it had originally planned. This came on the heels of Tuesday's drop in Housing Starts, which provided support for Yellen's concerns about the economy. Thursday, weekly Initial Unemployment Claims went up by 1,000, but the big impetus for Friday's stock rally came from Charles Evans, Chicago Fed President and FOMC voter. This leading Fed dove (doesn't want to hike interest rates) said he supported the current policy statement because it didn't rule out keeping rates at zero for a lengthy period!The week ended with the Dow UP 2.1%, to 18128; the S&P 500 UP 2.7%, to 2108; and the Nasdaq UP 3.2%, to 5026.In spite of the stock rally Friday and some bullish news from Europe, bonds enjoyed a decent week. The 30YR FNMA 4.0% bond we watch finished the week UP .11, to $106.24. Freddie Mac's Primary Mortgage Market Survey for the week ending March 19 showed national average fixed mortgage rates drifting back down after a slight rise the prior week. These low rates provide a nice start to the spring home buying season. Remember, mortgage rates can be extremely volatile, so check with your mortgage professional for up to the minute information. DID YOU KNOW?... Fannie Mae's Q1 2015 Mortgage Lender Sentiment Survey reports that for GSE-eligible loans, 71% of lenders surveyed say they expect purchase mortgage demand to go up in the next three months. Only 59% thought so a year ago. >> This Week’s Forecast HOME SALES UP AND DOWN, INFLATION OK, GDP MILD... Housing continues go forward by fits and starts. Analysts expect to see Existing Home Sales ahead in February, edging back toward the 5 million unit annual level. But New Home Sales are forecast off for the month, still not able to crack a half million units a year. At least February's Consumer Price Index (CPI) is predicted to show inflation remains moderate. Unfortunately, economic growth is staying moderate as well, with the Q4 GDP-3rd Estimate forecast in low 2% territory. >> The Week’s Economic Indicator CalendarWeaker than expected economic data tends to send bond prices up and interest rates down, while positive data points to lower bond prices and rising loan rates. Economic Calendar for the Week of Mar 23 – Mar 27 DateTime (ET)ReleaseForConsensusPriorImpactMMar 2310:00Existing Home SalesFeb4.90M4.82MModerateTuMar 2408:30Consumer Price Index (CPI)Feb0.2%–0.7%HIGHTuMar 2408:30Core CPIFeb0.1%0.2%HIGHTuMar 2410:00New Home SalesFeb470K481KModerateWMar 2508:30Durable Goods OrdersFeb0.5%2.8%ModerateWMar 2510:30Crude Inventories3/21NA9.622MModerateThMar 2608:30Initial Unemployment Claims3/21293K291KModerateThMar 26 08:30Continuing Unemployment Claims3/142.425M2.417MModerateFMar 2708:30GDP–3rd EstimateQ42.4%2.2%ModerateFMar 2708:30GDP Deflator–3rd EstimateQ40.1%0.1%ModerateFMar 2710:00U. of Michigan Consumer Sentiment–FinalMarNA91.2Moderate >> Federal Reserve Watch Forecasting Federal Reserve policy changes in coming months... Fed Chair Janet Yellen says she isn't getting "impatient" about hiking the rate, but the bank's policy statement no longer asserts the Fed will be "patient." More economists see a higher rate midyear, but most still expect it to come later. Note: In the lower chart, a 3% probability of change is a 97% certainty the rate will stay the same.Current Fed Funds Rate: 0%–0.25%After FOMC meeting on:Consensus Apr 290%–0.25%Jun 170%–0.25%Jul 290%–0.25%Probability of change from current policy:After FOMC meeting on:Consensus Apr 29 0%Jun 17 11%Jul 29 28%This e-mail is an advertisement for Team Funston/Meloni. The material provided is for informational and educational purposes only and should not be construed as investment and/or mortgage advice, or a commitment to lend. Although the material is deemed to be accurate and reliable, there is no guarantee of its accuracy. The material contained in this message is the property of Supreme Lending and cannot be reproduced for any use without prior written consent. This message is intended for business professionals only and is not intended for distribution to consumers or other third parties. The material does not represent the opinion of Supreme Lending. EVERETT FINANCIAL, INC. D/B/A SUPREME LENDING (NMLS ID #2129) at 14801 Quorum Dr., #300, Dallas, TX 75254. 877-350-5225. Copyright © 2015. All rights reserved. This is not an offer to enter into an agreement. Not all customers will qualify. Information, rates, and programs are subject to change without prior notice. All products are subject to credit and property approval. Not all products are available in all states. Other restrictions and limitations may apply. Supreme Lending is not affiliated with any government agency. For Supreme Lending’s Licensing Statements, visit http://corporate.supremelending.com/Licensing.aspx. For all NMLS licenses held by Supreme, visit http://www.nmlsconsumeraccess.org/EntityDetails.aspx/COMPANY/2129/ This email was sent to [email protected] may unsubscribe from future advertisement e-mails from Team Funston/Meloni.Click here to unsubscribe MCID16308
THE CHIODO TEAM - Ralph Chiodo Broker / Owner 610-792-4800 x 111 Karen Chiodo Realtor / Owner 610-792-4800 x 102 Together Ralph and Karen (and their dedicated Tea....