Personal Income and Outlays: Spending remained flat as personal incomes rose 0.4% in the month of April. There were declines in spending in both durable and nondurable goods that were canceled out by an increase in spending on services. Wages accounted for half the increase in income, coming in at 0.2%. Prices were flat for the month, while increasing just 0.1% in the core categories. According to the report, Americans were saving 5.6% of their income, up 0.4%.
ISM Manufacturing Index: The index was up a full point in May to 52.5. New orders were up 2.3 points to 55.8. Total orders came in at 50.0, indicating they were neither growing nor declining. Employment had a 3.4 point gain to 51.7 and production is at 54.5. Meanwhile, supplier deliveries were up very slightly to 50.7 from 50.1 in April. There was also a lower cost for raw materials.
MBA Mortgage Applications: Applications dropped 7.6%. The biggest reason for this was a 12.0% drop in refinances. This is a bit surprising given that the average 30-year fixed mortgage rate was down 5 basis points to 4.02%. Purchases also fell 3.0% for the week.
International Trade: The conclusion of the West Coast port strike in mid-March caused a flood of imports that threw off the trade balance for that month. April’s numbers point to a return to normalcy. The trade deficit fell nearly $10 billion, closing the gap to $40.9 billion. Exports were up 1.0% to $189.9 billion. Meanwhile, imports fell 3.3% to $230.8 billion.
Jobless Claims: Initial claims fell 6,000 jobs to 276,000. The four-week average is up 2,750, coming in at 274,750. This is 5,000 lower than a month ago. Continuing claims were down 30,000 to 2.196 million. The four-week average fell 9,000 to 2.214 million.
Employment situation: The May jobs report showed some real strength, as non-farm payrolls grew by 280,000. Of that, 262,000 jobs were added in the private sector. Among the industries with the biggest gains in this area were professional business services with 63,000 jobs added and trade and transportation with 50,000 jobs. The work force participation rate ticked up a tenth to 62.9%. Meanwhile, average hourly earnings rose by 0.3%. The work week averaged 34.5 hours. Revisions for March and April also added 32,000 jobs in those months.
Fixed rates were unchanged or down while adjustable rates were up.
30-year fixed-rate mortgages (FRMs) averaged 3.87% with an average 0.6 point for the week ending June 4, 2015, unchanged from last week. A year ago at this time, 30-year FRMs averaged 4.14%.
15-year FRMs this week averaged 3.08% with an average 0.5 point, down from last week when they averaged 3.11%. A year ago at this time, 15-year FRMs averaged 3.23%.
5-year Treasury-indexed hybrid adjustable-rate mortgages (ARMs) averaged 2.96% this week with an average 0.5 point, up from last week when they averaged 2.90%. A year ago, 5-year ARMs averaged 2.93%.
1-year Treasury-indexed ARMs averaged 2.59% this week with an average 0.2 point, up from last week when they averaged 2.50%. At this time last year, 1-year ARMs averaged 2.40%.
The markets were mixed on Friday as investors kept an eye on the situation in Greece and reacted well to bond yields pushing higher following a strong jobs report in May.
The Dow Jones Industrial Average was down 56.12 points to end the week, closing at 17,849.46, a weekly loss of 0.90%. The S&P 500 was down 3.01 points, finishing at 2,092.83. This was down 0.70% from last Friday’s close. The NASDAQ was the sole index finishing in the black on Friday. It closed up 9.33 points at 5,068.46, down just 0.03% for the week.
The Week Ahead
Tuesday, June 9
Quicken Loans HPPI/HVI (10:00 a.m. ET) – Quicken Loans, the second largest retail mortgage lender in the U.S., releases a monthly report on home values as well as the difference between homeowner perception of value versus appraiser opinion of value.
Wednesday, June 10
MBA Mortgage Applications (7 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, June 11
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.
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 services stores. Data is collected from the Monthly Retail Trade Survey conducted by the U.S. Census Bureau.
Friday, June 12
Producer Price Index (PPI) (8:30 a.m. ET) – The Producer Price Index measures the average change over time in the prices received by domestic producers of goods and services.
Consumer Sentiment (10 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.
Visit the Quicken Loans Zing Blog for updated information on important economic releases that affect your wallet.
If so, subscribe now for tips on home, money, and life delivered straight to your inbox.