International Trade – The U. S. trade deficit increased from $40 billion in August to $43 billion in September. This is blamed on slower global growth, a widening of the petroleum gap and a 1.5% decline in exports.
MBA Purchase Applications – Purchase applications rose 3.0% for the week of October 31, boosted by a dip in rates. The year-over-year rate of applications still remains down 13%.
Jobless Claims – Initial jobless claims dropped by 10,000 in the week of November 1, to 278,000. The four-week average is down to 279,000, a new 14-year low. Also, continuing jobless claims were down 39,000, coming in at 2.348 million, another 14-year low.
Employment Situation – The unemployment rate dropped, but wages have continued to be soft. Nonfarm payroll jobs were 214,000 in October, but failed to meet expectations of 240,000.
Mortgage rates ticked up across the board this week due to better-than-expected economic data.
30-year fixed-rate mortgages (FRMs) averaged 4.02% with an average 0.5 point for the week ending November 6, 2014, up from last week when they averaged 3.98%. A year ago at this time, 30-year FRMs averaged 4.16%.
15-year FRMs this week averaged 3.21% with an average 0.5 point, up from last week when they averaged 3.13%. A year ago at this time, 15-year FRMs averaged 3.27%.
5-year Treasury-indexed hybrid adjustable rate mortgages (ARMs) averaged 2.97% this week with an average 0.5 point, up from last week when they averaged 2.94%. A year ago, 5-year ARMs averaged 2.96%.
1-year Treasury-indexed ARMs averaged 2.45% this week with an average 0.4 point, up from last week when they averaged 2.43%. At this time last year, 1-year ARMs averaged 2.61%.
The Dow Jones Industrial Average finished up 19.46 points on Friday to close at 17,573.93. Meanwhile, the S&P 500 was up 0.71 points to finish at 2,031.92. Both were record closes. The NASDAQ fell 5.94 points to finish the week at 4,632.53.
The Week Ahead
Wednesday, November 12
MBA Purchase Applications (7:00 a.m. ET) – The purchase applications index measures applications at mortgage lenders. This is a leading indicator for single-family home sales and housing construction.
Thursday, November 13
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 trend suggests a deteriorating labor market. The four-week moving average of new claims smooths out weekly volatility.
Friday, November 14
Retail Sales (8:30 a.m. ET) – Retail sales measure the total receipts at stores that sell merchandise and related services to final consumers. Sales are by retail and food services stores. Data is collected from the Monthly Retail Trade Survey conducted by the U.S. Bureau of the Census.
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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