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Tuesday - May 23  

A lone suicide bomber killed 22 and injured 59 overnight in at a concert in Manchester, U.K. ISIS has taken responsibility for the horrific attack. One person has been apprehended in connection with the bombing, while the bomber has yet to be identified. The attack occurred at an Ariana Grande concert where many children were present.

After hitting a near 10-year high in March, New Home Sales in April fell to an annual rate of 569,000, below the 605,000 expected and below the 642,000 in March, which was revised from 621,000. From April 2016 to April 2017, sales were up just 0.5%. The decline in sales was due in part to rising building material costs along with a lack of lots and a shortage in labor. Inventories are running at a 5.7 month supply, just below the six-month supply that is considered healthy.

Luxury home builder Toll Brothers reported on Tuesday that it sold more homes and said orders surged 26% in its quarterly earnings report. As of April 30, Toll Brothers sold 1,638 in the latest quarter, up from 1,304 in the previous quarter. The average price to purchase a new Toll Brothers home fell to $832,400 from $855,500 a year earlier, which was due in part to lower priced homes geared towards millennials. A spokesperson for the builder said it was the best spring selling season in over 10 years.


Monday - May 22  

President Trump began his first foreign trip in Saudi Arabia and other Gulf States over the weekend as the U.S. signed $350 billion worth of defense equipment and service supports, which is lifting Stocks this morning. The president will now visit Israel on Monday and Tuesday, Rome and the Vatican on Wednesday. Stocks took a hit last week over political turmoil out of the Trump administration, but those concerns quickly faded. The closely S&P 500 Stock Index continues to trade near all-time highs.

There are no economic reports due for release today and the calendar is on the light side this week. Trading volumes will most likely begin to ease late Thursday as players gear up for the long Memorial Day weekend, the unofficial kick off of summer. The week the treasury will sell a total of $88B in Treasury Notes, which could impact trading. 

Heading into the long Memorial Day weekend, drivers are expected to take to the roads in a big way as they head off to their favorite vacation destinations. Motor club AAA expects 39.3 million Americans will travel this holiday weekend, the most in the past 12 years. Most of those will travel by car as AAA expects 34.6 million on the roads. A total of 2.9 million people in the USA are expected to take to the skies this Memorial Day, an increase of 5.5% over last year.


Friday - May 19  

The National Association of REALTORS® (NAR) reports that single-family existing home sales are expected to rise to a decade high in 2017, fueled by a strong labor market and improving household confidence. The NAR reports that the first quarter of 2017 saw 5.62 million existing homes sold, the best quarter in a decade, up 3.5% from the same period last year. The NAR has forecasted that sales will increase 5% in 2017. However, started home shortages could be a problem and may discourage would-be first time homebuyers.

Ellie Mae reported on Friday that closing times for mortgage loans fell in April for the third consecutive month. The time it takes to close a loan fell to 42 days in April from 43 in March and a big drop since the 51 days seen in January. On the refinance end, it now takes 41 days to close the loan from 43 days in March. Ellie Mae cites improved technology in the reduction of time.

Motorists are gearing up for the long Memorial Day weekend next week as Americans gas up their cars and head to their favorite getaway destinations. The national average price for a regular gallon of gasoline fell to $2.34 this week from $2.40 a month ago, though up from $2.26 a year ago. The increased summer driving could cause a bump up in prices, but motor club AAA doesn't see a significant increase.


Thursday - May 18  

Mortgage rates edged lower in the latest week and remain just above all-time lows. Freddie Mac reported that the 30-year fixed mortgage rate declined to 4.02% from 4.05% in the latest week with 0.5 in points and fees. Mortgage rates continue to remain low, due to low inflation and the political turmoil out of Washington D.C., which pushed Bond prices higher and rates lower. In addition, the U.S. Federal Reserve continues to purchase Mortgage Backed Securities in the open markets, which has a lowering effect on mortgage rates.

Americans filing for first-time unemployment benefits continue to hover near lows not seen since the early 1970s as the labor market continues to strengthen. Weekly Initial Jobless Claims fell by 4,000 to 232,000, below the 240,000 expected. Jobless claims have now remained below the 300,000 level for the longest stretch since 1970. Continuing claims declined 22,000 to 1.90 million in the week ended May 6, the lowest level since November 1988.

Manufacturing activity in the Philadelphia region surged in May signaling that the sector continues to expand. The Philadelphia Fed Index increased from a reading of 22.0 in April to 38.8 this month. The index has been positive for 10 consecutive months. Within the report it showed that current new orders and shipments indexes remained at high readings. In addition, firms reported an increase in manufacturing employment this month.


Wednesday - May 17  

The Mortgage Bankers Association (MBA) reports that homeowners are getting better at paying their mortgages as loans in the process of foreclosure are at the lowest levels since 2007. The MBA's latest National Delinquency Survey showed that delinquency rates for mortgage loans on one- to four-unit residential properties declined to 4.71% of all loans outstanding at the end of the first quarter of 2017. The delinquency rate includes loans that are at least one payment past due but does not include loans in the process of foreclosure.

U.S. Stock markets are plunging today on concerns that political turmoil out of the White House could derail President Trump's pro-growth agenda. The Dow Jones Industrial Average was down nearly 300 points in early trading on Wall Street, the worst losses in two months. Stocks rallied sharply after the November election on promises that the new administration would usher in tax reforms, reduced regulations and the aforementioned pro-growth policies. However, those new policies are now seen as a concern, which is casting doubt over the Stock markets, which usually leads to a sell-off.

The New York Federal Reserve reports that household debt has reached new peaks driven by gains in mortgage, auto, and student debt. The latest Quarterly Report on Household Debt and Credit reveals that total household debt achieved a new peak in the first quarter of 2017, rising by $149 billion to $12.73 trillion — $50 billion above the previous peak reached in the third quarter of 2008. Balances climbed in several areas: mortgages, 1.7 percent; auto loans, 0.9 percent; and student loans, 2.6 percent. Credit card balances fell 1.9 percent this quarter.


Tuesday - May 16  

The housing market received a blow today after newly constructed housing fell to a six-month low, due in part to a plunge in rental construction. April Housing Starts fell 2.6% from March to an annual rate of 1.172 million units, below the 1.26 million expected. Single-family construction, which makes up a large portion of the residential market, rose 0.4% to an annual pace of 835,000 units. The rental construction sector plunged 9.2% and have declined four straight months, which could suggest that the rental markets is beginning to peak.

Government sponsored entity and secondary mortgage market provider Fannie Mae released its Economic & Strategic Housing Outlook for May on Tuesday. The report showed that housing was a bright spot during the first quarter, and home sales performed well going into the spring season, thanks to solid labor market conditions and a recent retreat in mortgage rates. On the economic front, Fannie Mae says that current data suggests that consumer spending growth will pick up in the second quarter, while businesses will likely increase production in an effort to rebuild inventories.

Mortgage modification rates declined in the past week after hitting an 18-month high back in January. Fannie Mae and Freddie Mac recently cut the rate to modify a mortgage from 4.25% to 4.125%. The modification program is designed to help those borrowers who are ineligible for the Home Affordable Modification Program. The decrease came after mortgage rates recently declined.


Monday - May 15  

Home builder confidence grew in May as the housing market continues to strengthen. The National Association for Home Builders reported that its May Housing Market Index rose two points in May from April to 70. It was the second highest reading since the housing market downturn back in 2008 - 2009. “This report shows that builders’ optimism in the housing market is solidifying, even as they deal with higher building material costs and shortages of lots and labor,” said NAHB Chairman Granger MacDonald, a home builder and developer from Kerrville, Texas.

Mortgage applications to purchase new homes declined in April, but the decrease could be due in part to the strong numbers in March. The Mortgage Bankers Association reported that applications fell by 20% from march and were down 4.3% from a year ago. The average loan size of new homes decreased from $328,100 in March to $326,284 in March. Breaking down the report it showed that conventional loans composed 68.5% of loan applications, FHA loans composed 17.7%, RHS/USDA loans composed 1.4% and VA loans composed 12.4%.

Manufacturing activity in the New York State region fell into negative territory in May for the first time since October. The New York Federal Reserve reported that its Empire Manufacturing Index fell six points to -1.0, below the +7.5 expected. Within the report it showed that the new orders index fell, shipments edged lower, while the labor market component showed a modest increase in both employment and hours worked.


Friday - May 12  

April Retail Sales rose 0.4% versus the 0.6% expected, while x-autos gained 0.3%, below the 0.5% expected. The 0.4% was an improvement from the 0.1% reported in March, which was also revised higher from -0.3%. Consumers spent at auto dealers, hardware stores and e-commerce sites.

The inflation reading Consumer Price Index was up 0.2% in April, in line with estimates. The year-over-year number declined to 2.2% from 2.4%, which was bond friendly. When stripping out food and energy, the Core CPI saw a 0.1% gain in April, just below the 0.2% expected. Year-over-year slipped to 1.9% from the +2% that has been the norm over the past 12 months.

The Census bureau shows that 854,000 new-owner households were formed during the first quarter of 2017 versus the 365,000 new rental households. It's the first time in 10 years that there were more new buyers than renters, per Trulia. Seeing such a shift from buying a home rather than renting is a very good sign.


Thursday - May 11  

Inflation at the wholesale level jumped in April from March due to a rise in prices for food and energy. The Producer Price Index (PPI) rose 0.5%, above the 0.2% expected and above the -0.1% registered in March. For the past 12 months, PPI surged 2.5%, the biggest rise since February 2012. The so-called Core PPI, which strips out volatile food and energy, jumped 0.4%, above the 0.2% expected. The hotter wholesale inflation data pushed Bond prices into negative territory. The more closely watched Consumer Price Index will be released on Friday and will be dissected by the Federal Reserve.

Storied retailer Macy's reports that it will be closing 100 more stores after weak earnings hit the 158 year old company. Macy's numbers fell short on earnings, revenues and same-store sales as it struggles to keep existing customers, let alone gain any new ones. Competition from the likes of Amazon, TJX Cos' and Ulta Beauty have put a dent in sales while its exposure to many weaker malls fail to lure in shoppers.

Foreclosure activity fell to its lowest level since 2005 as the housing sector continues to improve. A reported 77,049 filings were recorded in April, down 7% from March and down a full 23% from April 2016 to the lowest level since November 2005. Foreclosure filings include default notices, scheduled auctions and bank repossessions. Foreclosure activity continued to search for a new post-recession floor in April thanks in large part to the above-par performance of mortgages originated in the past seven years,” ATTOM senior vice president Daren Blomquist said.


Wednesday - May 10  

Boston Fed President Rosengren (non-FOMC voter, hawk) will be speaking at 12:00 p.m. ET and said that the Fed's balance sheet should start to be trimmed in 2017. Mr. Rosengren did say that if tapered, there would be room for the industry and the private sector to pick up the slack as the Fed gets less active in the market. He said, "I don’t think it’s going to be all that disruptive."

Mortgage rates were unchanged in the latest week and remain just above historically low levels. The Mortgage Bankers Association reported on Wednesday that the 30-year fixed conforming mortgage rate ($412,100 or less) remained at 4.23% last week, with points declining to 0.31 from 0.32. Similarly, the 30-year fixed-rate mortgage with jumbo loan balances (greater than $424,100) increased to 4.22% from 4.18% with 0.28 points. In addition, the 30-year fixed-rate mortgage backed by the FHA increased to 4.09% from 4.06%, with 0.24 points.

Small business optimism across the U.S. remained at high levels in April, though future business conditions declined. The National Federation of Independent released its Small Business Optimism Index this week slipping by 0.2 points to 104.5. April was the sixth straight month for historically high optimism. Looking ahead, the failure of Congress to repeal and replace Obamacare and to address the high cost of health care sent future optimism considerably lower.


Tuesday - May 9  

Fannie Mae released its Home Purchase Sentiment for April, which signaled a rebound following the March dip. The Fannie Mae Home Purchase Sentiment Index (HPSI) increased 2.2 percentage points in April to 86.7. The report saw five of the six components within the index increase. The net share of Americans who reported that now is a good time to buy a home increased 5 percentage points, while those who felt is a good time to sell declined five percentage points. Digging deeper into the data, consumers also expressed confidence about the stability of their jobs.

Job openings increased modestly in March as the labor market continues to strengthen. The JOLTS, Job Openings and Labor Turnover Survey, report showed that there were 5.7 million openings on the last day in March increasing by 118,000. The report is closely watched by Fed Chair Yellen. Job openings were seen in the professional and business sectors along with state and local government education, while declines were seen in mining and logging.

Home foreclosures declined to their lowest level since 2007 as the housing sector continues to improve. CoreLogic reports that mortgages delinquent by 30 days or more, including those in foreclosure, made up 5% of the market share in February. CoreLogic went on to report that as of February 2017, the foreclosure inventory rate, which measures the share of mortgages in some stage of the foreclosure process, was 0.8% compared with 1.1% in February 2016. The serious delinquency rate, defined as 90 days or more past due including loans in foreclosure, was 2.2% in February 2017, down from 2.8% in February 2016.


Monday - May 8  

Contrary to reports that home prices across the nation have risen higher than previous peaks, a new study by online real estate information company Trulia reports that prices have not yet recovered their full value that was lost when the housing bubble burst back in 2008. The survey showed that 34.2% of homes have reached levels that are above their pre-recession peaks. There are pockets where values have risen to pre-recession levels, such as Denver and San Francisco, though areas like Las Vegas and parts of Arizona have seen only 3% of homes hit their price peaks.

Cleveland Fed President Mester (non-FOMC voter) said inflation is nearing the 2% target, the Fed's employment goal has been reached, and recent economic weakness is transitory. In order for the Fed to hike rates further, they want to see Core Personal Consumption Expenditure rise confidently above 2%. Mr. Mester went on calling for continued removal of low interest rates and announcing plans in 2017 to trim the Fed's $4.5 trillion portfolio of Treasury and Mortgage Backed Securities.

Fannie Mae released its monthly Home Purchase Sentiment Index revealing that Fannie housing sentiment in April rebounded following the March dip. The Fannie Mae Home Purchase Sentiment Index® (HPSI) increased 2.2 percentage points in April to 86 with five of the six components increasing. The net share of Americans who reported that now is a good time to buy a home rose 5 percentage points, while the net share reporting that now is a good time to sell a home decreased 5 percentage points. Consumers also expressed greater confidence about the stability of their jobs, with the net share of that component jumping 7 percentage points.


Monday - May 8  

Contrary to reports that home prices across the nation have risen higher than previous peaks, a new study by online real estate information company Trulia reports that prices have not yet recovered their full value that was lost when the housing bubble burst back in 2008. The survey showed that 34.2% of homes have reached levels that are above their pre-recession peaks. There are pockets where values have risen to pre-recession levels, such as Denver and San Francisco, though areas like Las Vegas and parts of Arizona have seen only 3% of homes hit their price peaks.

Cleveland Fed President Mester (non-FOMC voter) said inflation is nearing the 2% target, the Fed's employment goal has been reached, and recent economic weakness is transitory. In order for the Fed to hike rates further, they want to see Core Personal Consumption Expenditure rise confidently above 2%. Mr. Mester went on calling for continued removal of low interest rates and announcing plans in 2017 to trim the Fed's $4.5 trillion portfolio of Treasury and Mortgage Backed Securities.

Fannie Mae released its monthly Home Purchase Sentiment Index revealing that Fannie housing sentiment in April rebounded following the March dip. The Fannie Mae Home Purchase Sentiment Index® (HPSI) increased 2.2 percentage points in April to 86 with five of the six components increasing. The net share of Americans who reported that now is a good time to buy a home rose 5 percentage points, while the net share reporting that now is a good time to sell a home decreased 5 percentage points. Consumers also expressed greater confidence about the stability of their jobs, with the net share of that component jumping 7 percentage points.


Thursday - May 4  

The Jobs Report for April will be released tomorrow morning at 8:30 a.m. ET and the numbers always carry big headline risks for the markets and mortgage rates. It is estimated that employers added 180,000 new workers, after the weak 98,000 created in February. The Unemployment Rate is expected to edge lower to 4.6%. A key metric in the report will be hourly earnings to gauge whether or not workers wages are rising after being stagnant over the past few years.

With the summer driving season set to unofficially kick off on Memorial Day weekend, gas prices have edged lower in the past week though up from a month ago. The national average price for a regular gallon of gasoline is at $2.36, down from $2.39 a week ago. Motorists can find current gas prices along their route with the free AAA mobile app for iPhone, iPad, and Android.

Real estate research firm Trulia reported this week that prices for most U.S. homes are still below the prerecession levels, which conflicts with other data that shows housing prices surging above the high water marks. The median home price rose to $196,500 in March, well above the $151,900 at the market lows in April 2012. Trulia also reported that just 34.2% of home prices have risen above the prerecession values.


Wednesday - May 3  

Job growth in the private sector remained steady in April, though hiring declined in both construction and retail. Payroll processor ADP reported on Wednesday that the private sector added 177,000 workers last month, above the 170,000 expected. The report comes ahead of Friday's monthly government Jobs Report for April, where it is expected that employment in both the private and public increased by 180,000. Within the report solid hiring was seen in professional and business services, education and health care, leisure and hospitality and manufacturering.

Mortgage rates edged slightly higher in the latest week but remain just above historically low levels. The Mortgage Bankers Association reported on Wednesday that the 30-year fixed conforming mortgage rate ($412,100 or less) rose to 4.23% from 4.20%, with points declining to 0.32 from 0.37. Similarly, the 30-year fixed-rate mortgage with jumbo loan balances (greater than $424,100) increased to 4.18% from 4.15% with 0.23 points. In addition, the 30-year fixed-rate mortgage backed by the FHA increased to 4.06% from 4.03%, with 0.24 points.

A recent survey by business and employment social media oriented LinkedIn showed that April had the strongest month for hiring since June 2015. The LinkedIn Workforce Report showed that hiring was up 3.4% from March, while increasing nearly 17% from April 2016. The LinkedIn Workforce Report is a monthly report on employment trends in the U.S. workforce divided into two sections, nationally and a city section.


Tuesday - May 2  

CoreLogic reports that home prices, including distressed sales, rose 7.1% from March 2016 to March 2017. It was the 62nd consecutive month of gains. From February to March, prices were up 1.6%. The year-over-year home price index is now just 2.8% below its 2006 peak. Despite weak economic growth, home prices continue to rise due in part to low inventories of homes for sale. Looking ahead, CoreLogic is forecasting a near 5% increase from March 2017 to March 2018.

The two-day Federal Open Market Committee meeting kicks off on Capitol Hill today in Washington D.C. where Fed members gather to discuss the state of the U.S. economy and monetary policy. There is a zero percent chance of a hike to the short-term Fed Funds Rate, but the statement may offer some clues as to the path of future interest rate policy. The monetary policy statement will be released at 2:00 p.m. ET on Wednesday.

Sales at U.S. auto makers reported big declines in April due in part to lower sales for trucks and SUVs, which were big profit makers in recent years. Ford Motor reported a 7.1% decline while General Motors saw sales fall by 5.8% compared to the same month last year. Car companies have been churning out large quantities of vehicles to meet the demand in recent years, but they may need to cut back on production going forward to avoid the big price wars that took place 10 years ago.


Tuesday - May 2  

CoreLogic reports that home prices, including distressed sales, rose 7.1% from March 2016 to March 2017. It was the 62nd consecutive month of gains. From February to March, prices were up 1.6%. The year-over-year home price index is now just 2.8% below its 2006 peak. Despite weak economic growth, home prices continue to rise due in part to low inventories of homes for sale. Looking ahead, CoreLogic is forecasting a near 5% increase from March 2017 to March 2018.

The two-day Federal Open Market Committee meeting kicks off on Capitol Hill today in Washington D.C. where Fed members gather to discuss the state of the U.S. economy and monetary policy. There is a zero percent chance of a hike to the short-term Fed Funds Rate, but the statement may offer some clues as to the path of future interest rate policy. The monetary policy statement will be released at 2:00 p.m. ET on Wednesday.

Sales at U.S. auto makers reported big declines in April due in part to lower sales for trucks and SUVs, which were big profit makers in recent years. Ford Motor reported a 7.1% decline while General Motors saw sales fall by 5.8% compared to the same month last year. Car companies have been churning out large quantities of vehicles to meet the demand in recent years, but they may need to cut back on production going forward to avoid the big price wars that took place 10 years ago.


Monday - May 1  

Manufacturing across the nation eased a bit in April as companies scaled back on hiring plans as product sales declined. The ISM National Manufacturing Index slipped to 54.8 in April from 57.2 in March. It was below forecasts of 56.5.

Inflation remained tame in March after the Gross Domestic Product saw consumer spending plunge in the first quarter of 2017. The Fed's favorite inflation gauge, the Core PCE, slipped to 1.6% annually from the 1.8% annual number seen in February.

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