Real Estate & Market Report: November 1, 2013
By: Fred Arnold
What was supposed to be a week of major market moving news never really materialized. The news reports came but the market did not seem to care much about anything that was reported.
It seems that the majority of the reports came in with little surprise so investors made the best trades they could on the news. Not to say that the market didn't move, however a jump or decline of 100 points these days is considered par for the course rather than a front page headline.
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It came as no surprise that inflation on the wholesale level remained subdued. In August there was a slight jump in wholesale inflation however in September the increase was an insignificant .1%. Prices on the wholesale level are 1.2% above the same time last year. Prices on the retail level were slightly elevated with the Consumer Price Index reporting an increase of .1% as a whole however when you eliminate volatile food and energy prices the core inflation rate rose 1.7% from a year ago.
The ADP employment report showed a smaller-than-expected rise in private payroll growth, at 130,000 in October vs the Econoday consensus for 138,000. The number which most investors focus on is the government2019s employment numbers which are due to be released next Friday.
Mortgage rates have been declining over the last few weeks and seem to be finally giving a lift to mortgage applications. The Mortgage Bankers Association reported that last week purchase applications rose 2.0% and refinance apps jumped 9%.
The Fed made their monthly announcement after their meeting ended on Wednesday, and as expected, the Fed kept the stimulus program the same. Earlier in the year there was plenty of talk that by this time the Fed would begin to taper the stimulus program, however weakness in some of the economic reports in the last couple of months has the Fed continuing their wait and see attitude and not jumping to make any changes that could be disruptive to the economic recovery.
Reinforcing the Fed's decision to keep interest rates the same was less than stellar news from the housing sector. The housing market is supposed to be a center of strength for the economy but one couldn't tell from the pending home sales report which has been down, not up, for 4 months in a row. Pending home sales fell 5.6 percent decline. Details show declines across all regions.
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The pending home sale index is down 1.2 percent from the same time last year which is the first negative reading in nearly 2-1/2 years.
Have a fun, safe and happy weekend!
Next week's market moving reports:
Monday November 4th - Factory Orders
Tuesday November 5th - ISM Non-Manufacturing Index
Wednesday November 6th - MBA Purchase Applications
Thursday November 7th - First Time Jobless Claims and GDP
Friday November 8th - National Employment
As your mortgage professional, I am happy to assist you with any information you may need regarding mortgage or real estate information. I welcome the opportunity to serve you in any way I possibly can. Please feel free to reach me at 661-505-4300.