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Market Update - Quicken Loans Zing Blog

The economists clearly decided to take their summer vacations this week because there isn’t much happening. We do get new mortgage applications and jobless claims data as well as a consumer sentiment number.

Headline News

MBA Mortgage Applications: Applications were up 9.3% overall last week. Although the average rate on a 30-year fixed mortgage was down 2 basis points to 3.83%, it may be that a lot of this increased activity was driven by the uncertainty leading up to the release last Friday of less than stellar employment numbers. Purchases were up 12.0%, and refinances were up 7.0%.

Jobless Claims: In a bounce-back from the previous week’s dreadful employment report, initial jobless claims fell 4,000 to 264,000 last week. Meanwhile, the four-week average is down 7,500 to 269,500. It was a good week for continuing claims as well. They fell 77,000 to 2.10 million. The four-week average was down 18,000 at 2.145 million.

Consumer Sentiment: Consumer sentiment came in at 94.3 in its first June reading. This is down just 0.4 points from the final reading of May. Current conditions are up almost 2 points to 111.7. There was strength across the board for current consumer readings. The expectations component was down 1.7 points to 83.2. There are still high income expectations and a good outlook on the jobs market. Inflation expectations are still low, unchanged at 2.4% over the next year. Five-year expectations are down 0.2%, coming in at 2.3%.

Mortgage News

Mortgage rates were down quite a bit last week following the disappointment with the May employment report as money flooded back to bonds.

Thirty-year fixed-rate mortgages (FRMs) averaged 3.60%, with an average 0.5 point for the week ending June 9, down from last week, when they averaged 3.66%. A year ago at this time, 30-year FRMs averaged 4.04%.

Fifteen-year FRMs this week averaged 2.87% with an average 0.5 point, down from last week when they averaged 2.92%. A year ago at this time, 15-year FRMs averaged 3.25%.

Five-year Treasury-indexed hybrid adjustable rate mortgages (ARMs) averaged 2.82% this week with an average 0.5 point, down from last week, when they averaged 2.88%. A year ago, 5-year ARMs averaged 3.01%.

Stock Markets

The markets were lower on Friday as global growth concerns weighed heavy on investors’ minds. First, Greece was an issue. Now, Great Britain is threatening to leave the European Union, which is causing some uncertainty in the currency markets while traders await the results of the referendum.

The Dow Jones Industrial Average was 119.85 points lower on Friday, falling to 17,865.34. It was down 0.67% for the week. The S&P 500 was down 19.41 points to 2,096.07, down 0.92% for the week. Finally, the NASDAQ shed 64.07 points, finishing at 4,894.55. It was down 1.29% for the week.

The Week Ahead

Tuesday, June 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 measured by retail and food service stores. Data is collected from the Monthly Retail Trade Survey conducted by the U.S. Census Bureau.

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 that compares what people think their homes are worth with the opinions of appraisers. 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, June 15

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.

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.

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.

Thursday, June 16

Consumer Price Index (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 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.

Housing Market Index (10:00 a.m. ET) – The National Association of Home Builders produces a housing market index based on a survey in which respondents from this organization are asked to rate the general economy and housing market conditions. The Housing Market Index is a weighted average of separate diffusion indexes, including present sales of new homes, sales of new homes expected in the next six months and traffic of prospective buyers in new homes.

Housing Starts (8:30 a.m. ET) – A housing start is registered when the construction of a new residential building begins. The start of construction is defined as the beginning of excavation of the foundation for the building.

Next week is positively jammed with data, and we’ll have it all for you. If economics isn’t your thing, we also have plenty of practical home, money and lifestyle content you can enjoy by subscribing to the Quicken Loans Zing Blog.

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