It’s a short week on the stock market. In my opinion, most Fridays are good, but this one is admittedly special. If you’re celebrating this weekend, enjoy your holidays. What wasn’t so good was the employment report, although it could’ve been worse.
ISM Manufacturing Index: Manufacturing continues to grow, although at a slower pace than it did in February, down 0.5 points to 57.2. However, things were still very strong. New orders were down 0.6 points to 64.5, but it’s the second strongest this metric has been since December 2013. New export orders were also up 4.0 points to 59.0. Backlog orders are up 0.5 points to 57.5. The employment index was up 4.7 points to 58.9.
International Trade: The U.S. trade deficit was down $4.9 billion to $43.6 billion. There was a 1.8% drop in February. Imports of consumer goods were down $3.1 billion to $49.0 billion. Car imports were down to $29.1 billion, declining $2.7 billion. Crude oil imports were up $13.0 billion as the cost per barrel was up $1.31 to $45.25. Exports were up 0.2%. Consumer goods exports were up $700 million to $17.1 billion. However, services exports ran unchanged at $64.4 billion. Exports of capital goods were down $600 million to $42.9 billion as civilian aircraft orders fell. Food exports fell by $700 million.
MBA Mortgage Applications: Despite the average rate on the 30-year fixed mortgage only being one basis point higher at 4.34%, overall applications fell 1.6%. Purchases were up 1.0%, but refinances fell 4.0% on the week.
Jobless Claims: Initial jobless claims were down 25,000 to 234,000 last week. The four-week average was down 4,500 to come in at 250,000. Continuing claims were down 24,000 to come in at 2.028 million. The four-week average came in at its lowest level since mid-June 2000, coming in at 2.023 million.
Employment Situation: A category three storm hitting the Northeast may have something to do with a much weaker than expected employment report. The 98,000 figure was the lowest it’s been since May of last year. The good news is that the unemployment rate was down 0.2% to 4.5%. Private payrolls added 89,000 jobs and there were 9,000 jobs added to government payrolls. Average hourly earnings were also up 0.2% on the month and 2.7% on the year. Employees worked six less minutes in March, with the average workweek coming in at 34 hours, 18 minutes. Retail jobs were down 30,000. Trade and transportation payrolls were down 27,000. Manufacturing and mining added 11,000 jobs each. There were 6,000 jobs added to construction as well. The labor force participation rate held steady at 63.0%.
Mortgage rates were mixed, but fixed rates were lower. It remains a great time to lock your rate if you’re in the market.
This week, 30-year fixed-rate mortgages (FRMs) averaged 4.10% with an average 0.5 point for the week ending April 6, 2017, down from last week when they averaged 4.14%. A year ago at this time, 30-year FRMs averaged 3.59%.
Looking at shorter terms, 15-year FRMs this week averaged 3.36% with an average 0.5 point, down from last week when they averaged 3.39%. A year ago at this time, 15-year FRMs averaged 2.88%.
Finally, 5-year Treasury-indexed hybrid adjustable rate mortgages (ARMs) averaged 3.19% this week with an average 0.4 point, up from last week when they averaged 3.18%. A year ago, 5-year ARMs averaged 2.82%.
There was a lot going on in the markets on Friday as there was a mixed employment report, eyes on the fallout from the U.S. airstrike in Syria and further comments from New York Fed President William Dudley on how the Federal Reserve plans to reduce the balance sheet. Despite this, the market was pretty flat.
The Dow Jones Industrial Average was down 6.85 points Friday to close at 20,656.10, down 0.03% for the week. Meanwhile the S&P 500 fell to 2,355.54, falling 1.95 points for the day and 0.30% for the week. The NASDAQ had the worst week of the three, down 0.57% to close at 5,877.81. It was down 1.14 points on Friday.
The Week Ahead
Tuesday, April 11
Quicken Loans Home Price Perception Index (HPPI) (10:00 a.m. ET) – Quicken Loans, the nation’s second-largest retail mortgage lender, releases data every month comparing what people think their homes are worth through appraisals. Similar opinions of value often make for smoother purchase and refinance transactions.
Quicken Loans Home Value Index (HVI) (10:00 a.m. ET) – Quicken Loans also releases data on home values, both on the national and regional level. Homeowners can gain a perception of whether values are increasing or decreasing, and get a better idea of where they stand in terms of equity.
Wednesday, April 12
MBA Mortgage Applications (7:00 a.m. ET) – The mortgage applications index measures applications at mortgage lenders. This is a leading indicator for single-family home sales and housing construction.
Thursday, April 13
Jobless Claims (8:30 a.m. ET) – New unemployment claims are compiled weekly to show the number of individuals filing 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.
Producer Price Index (PPI) (8:30 a.m. ET) – The Producer Price Index measures the average change over time in prices received by domestic producers for the sale of goods and services.
Consumer Sentiment (10:00 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.
Friday, April 14
Consumer Price Index (CPI) (8:30 a.m. ET) – The consumer price index measures changes based on the price of a fixed basket of goods and services purchased by consumers.
Retail Sales (8:30 a.m. ET) – Retail sales measure total receipts from stores selling merchandise and related services to final consumers. Sales are measured by retail and food service stores. Data is collected from the Monthly Retail Trade Survey conducted by the U.S. Census Bureau.
The stock market is closed in observance of Good Friday.
It’s a short week, but there’s a fair amount of economic data coming down the pipe. Inflation and sales data is of particular interest. We know mortgage rates and economic data sometimes aren’t enough to get the brain buzzing on a Monday. If you subscribe to the Zing Blog below, we have plenty of home, money and life content to get you through the week. Rumor has it there’s a bunny who might be paying some of you a visit this Sunday. If you need to decorate eggs, we’ve got some tips for you.
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