In terms of actual economic data, there wasn’t a whole lot going on last week, but that doesn’t mean there wasn’t plenty for traders to keep an eye on. The fallout from Hurricane Harvey was ongoing as Hurricane Irma made its way toward Florida, and the wildfires are still blazing out West. Stay safe, wherever you are.
Equifax, one of the nation’s major credit bureaus announced last week that hacking had exposed all sorts of sensitive information, including names, addresses and Social Security numbers for 143 million Americans.
In political news, a deal was reached on the debt ceiling to avoid any nonpayment of U.S. debt for now. This week has to be better than the last one. Let’s jump into what happened.
MBA Mortgage Applications
Mortgage applications increased 3.3% last week as the average rate on a 30-year fixed mortgage fell 5 basis points to 4.06%. This is the lowest rates have been since November of last year. If you’re in the market, it’s a great time to lock your rate. Purchase applications rose 1.0% and refinances were up 5.0%.
The U.S. trade deficit widened slightly in July, up $200 million to come in at $43.7 billion. The goods deficits was unchanged at $65.3 billion, while the nation’s surplus in services fell 0.8% to $21.6 billion. Exports were down 0.3%, but there was a $1.1 billion increase in aircraft exports and $400 million in additional food exported. On the negative side, consumer goods exports fell $700 million. Cars and exports of nonmonetary gold were both down $600 million. Imports were down 0.2% as oil imports fell $900 million due to lower prices and volumes. There was an $800 million drop in car imports. There was also a $700 million fall in U.S. demand for industrial supplies from other countries.
Initial claims spiked last week, up 62,000 to 298,000. Much of this is being blamed on Hurricane Harvey. Several states also had estimated totals due to Labor Day. The four-week average was up 13,500 to 250,250. Continuing claims, which are reported with a two-week data lag, were down 5,000 to 1.940 million. The four-week average was down 4,000 to 1.948 million.
Mortgage rates fell to the lowest they’ve been this year last week. If you’re in the market to get a mortgage, it’s a great time for you. If you see a rate you like, you should definitely consider locking it up.
The rate on a 30-year fixed mortgage was 3.78% with 0.5 points, down four basis points for the week. Last year at this time, 30-year fixed-rate mortgages were at 3.54%.
On the shorter-term side, 15-year fixed-rate mortgages with 0.5 points in fees also fell four basis points to 3.08%. At this time last year, 15-year fixed rates were at 2.76%.
Finally, 5-year treasury-indexed adjustable rate mortgages (ARMs) were at 3.15% with 0.4 points upfront. This was up from 3.14% the previous week. At this time in 2016, 5-year ARM rates averaged 2.81%.
Markets fell last week as interest rates dropped, lowering financial stocks. Insurers were also preparing to handle the aftermath of Hurricane Irma.
The Dow Jones industrial average was up 13.01 points to 21,797.79. Despite this, it was down 0.86% on the week. The S&P 500 finished at 2,461.43, down 0.61% for the week after falling 3.67 points Friday. Finally, the Nasdaq was down 1.17% for the week after falling 37.68 points Friday to close at 6,360.10.
The Week Ahead
Tuesday, September 12
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, on both the national and regional levels. 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, September 13
MBA Mortgage Applications (7:00 a.m. ET) – The mortgage applications index measures applications to mortgage lenders. This is a leading indicator for single-family home sales and housing construction.
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.
Thursday, September 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.
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.
Friday, September 15
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.
Industrial Production (9:15 a.m. ET) – The Federal Reserve’s monthly index of industrial production – and the related capacity indexes and capacity utilization rates – covers manufacturing, mining, and electric and gas utilities.
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.
There’s a ton of economic data out this week. We’ll be paying particularly close attention to the inflation numbers and retail sales. It’ll all be here for you next week.
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