All markets were closed Thursday in observance of Thanksgiving. Also, the bond market closed at 2 p.m. ET Friday.
- Housing Starts – Permits jumped 6.2% in October after gaining 5.2% the month before. The 1.034 million pace was up 13.9% on the year. The multifamily component is up 22.5% on a year-ago basis while the single-family component is up 8.8%.
- Case-Shiller Home Price Index – Home prices were building steam through September, as the 20-city index rose an adjusted 1.0%. For the second month in a row, all 20 cities experienced gains, led by Atlanta at 1.9%. The year-on-year rate is at a recovery best of 13.3%.
- Consumer Confidence – The temporary agreement to end the shutdown in Washington did nothing to boost consumer confidence which fell to 70.4 in November. The weakness continues to be centered on expectations, which fell to 69.3 in November compared to 72.2 in October.
- Jobless Claims – Initial claims fell 10,000 in the November 23 week to a lower-than-expected 316,000. The four-week average is down 7,500 to a 331,750 level that is more than 15,000 below a month ago. Continuing claims fell 91,000 in the November 16 week to a new recovery low of 2.776 million. The four-week average is down 23,000 to a new recovery low of 2.832 million.
- Consumer Sentiment – Sentiment rose surprisingly higher, all the way up to 75.1 for the final November reading. The mid-month reading was 72.0, which implies a solid upper 70s level for the last two weeks, marking its best pace since August.
Black Friday 2013 marked the first Black Friday since 2009 that spending declined, increasing the chance that retailers will extend discounted items. Purchases at stores and websites fell 2.9%. Approximately 141 million people shopped, about 2 million more than last year, however, the average consumer’s spending dropped 3.9%.
According to the weekly Primary Mortgage Market Survey, 30- and 15-year fixed rates increased for the week.
30-year fixed-rate mortgages (FRM) averaged 4.29% with an average 0.7 point for the week ending November 27, 2013, up from last week when it averaged 4.22%. A year ago at this time, the 30-year FRM averaged 3.32%.
15-year FRM averaged 3.30% with an average 0.7 point, up from last week when it averaged 3.27%. A year ago at this time, the 15-year FRM averaged 2.64%.
5-year treasury-indexed hybrid adjustable-rate mortgages (ARM) averaged 2.94% this week with an average 0.5 point, down from last week when it averaged 2.95%. A year ago, the 5-year ARM averaged 2.72%.
1-year treasury-indexed ARM averaged 2.60% this week with an average 0.4 point, down from last week when it averaged 2.61%. At this time last year, the 1-year ARM averaged 2.56%.
With a shortened trading day, stocks ended Friday flat. The Dow Jones Industrial Average and the S&P 500 ended little changed, while the Nasdaq posted a small gain. With many investors taking the day off, trading volume was well below average. Despite the slow Friday, all three indexes ended higher for the week, marking the eighth consecutive weekly gain for the Dow and S&P 500. For the month, stocks ended November with gains between 3%-4%.
The Week Ahead
Wednesday, December 4:
- New Home Sales (10 a.m. ET) – New home sales measure the number of newly constructed homes with a committed sale during the month. The level of new home sales indicates housing market trends and, in turn, economic momentum and consumer purchases of furniture and appliances.
Thursday, December 5:
- GDP (8:30 a.m. ET) – Gross Domestic Product (GDP) is the broadest measure of aggregate economic activity and encompasses every sector of the economy.
- Jobless Claims (8:30 a.m. ET) – New unemployment claims are compiled weekly to show the number of individuals who filed for unemployment insurance for the first time. An increasing (decreasing) trend suggests a deteriorating (improving) labor market.
Friday, December 6:
- Consumer Sentiment (9:55 a.m. ET) – The University of Michigan’s Consumer Survey Center questions 500 households each month on their financial conditions and attitudes about the economy. Consumer sentiment is directly related to the strength of consumer spending.
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