Friday - September 1
The Bureau of Labor Statistics reported on Friday that job growth in August fell short of expectations but still remains on solid ground. Non-farm Payrolls rose by 156,000, below the 183,000 expected, while June and July were revised lower by a total of 41,000. Within the report it showed that wage growth was anemic rising 0.1%, while year-over-year wage growth remained at 2.5% for the fifth consecutive month. The Unemployment Rate ticked up to 4.4% from 4.3%. Overall, the report was a bit of a disappointment.
National manufacturing activity surged in August to the best level in six years, reports the Institute of Supply Management (ISM). The ISM Manufacturing Index rose to 58.8 from 56.3 in July. Within the report it showed that the employment component was strong, while new orders slightly decreased. Of the 18 manufacturing industries, 14 reported growth in August.
The unofficial end of summer will take place on Labor Day as schools open and vacations destinations become a distant memory. Many Americans will take to the roads for their last gasp of summer and will celebrate with parades, beach parties and backyard barbecues. The National Highway Traffic Safety Administration advises to play it safe on the roads this weekend and obey the 4-second rule: keep a full 4 seconds behind the vehicle in front of you. Look ahead to note any changes in traffic flow or behavior. Be safe and enjoy the long weekend!
Thursday - August 31
Inflation remained tame in July as evidenced by the Federal Reserve's favorite inflation gauge, the Core Personal Consumption Expenditure (PCE). The Core PCE rose 1.4% from July 2016 to July 2017, down from 1.5% in June; it has been declining since the beginning of the year. The Fed's target range is 2%. With inflation running low, the Fed will most likely be on hold to raise the short term Fed Funds Rate at future FOMC meetings.
Mortgage rates continued to decline this week in this low inflation environment. Freddie Mac reported Thursday morning that the 30-year fixed mortgage rate fell to 3.82% this week and has fallen four weeks in a row. That rate does carry a 0.5 point added on top. Last year this time the rate was 3.46%. Freddie Mac also reported that the 15-year fixed-rate mortgage dropped to 3.12% from 3.16%.
The National Association of REALTORS® (NAR) reported on Thursday that Pending Home Sales in July fell 0.8% and has declined four of the last five months. The NAR said that staggering low inventories throughout the country continue to stall contract activity. Lawrence Yun, NAR chief economist, says, “The housing market remains stuck in a holding pattern with little signs of breaking through. The pace of new listings is not catching up with what’s being sold at an astonishingly fast pace.”
Wednesday - August 30
The second read on second quarter 2017 Gross Domestic Product (GDP) rose to 3% from the initial read of 2.6%. The boost was fueled by a pop in consumer spending to 3.3% from 2.8% and an increase in business spending. Consumer spending makes up two-thirds of the U.S. economy. The 3% boost in GDP was the best reading since the 3.2% registered in the first quarter of 2015. GDP is the monetary value of all the finished goods and services produced within a country's borders in a specific time period. It is considered the broadest measure of economic activity.
Job growth in the U.S. continued to be a bright spot in the U.S. economy in August due in part to solid gains in manufacturing and construction jobs. The ADP Private Payrolls Report for August showed that employers added 237,000 new positions versus the 180,000 expected. In addition, July was revised higher to 201,000 from 178,000. The 237,000 was the fastest pace since March. The ADP Report comes ahead of the government's Jobs Report which will be released Friday morning.
Due to the devastation in the Houston, Texas area, gas prices have pushed higher in recent days. There are many refineries in the area that have been shut down by the storm. The national average price for a regular gallon of gasoline has risen to $2.40 from $2.37 yesterday and up from $2.30 a month ago. “No doubt, Harvey has impacted operations and access to refineries in the Gulf Coast. However a clear understanding of overall damage at the refineries is unknown,” said Jeanette Casselano, AAA spokesperson. “Despite the country’s overall oil and gasoline inventories being at or above five-year highs, until there is clear picture of damage and an idea when refineries can return to full operational status, gas prices will continue to increase.”
Tuesday - August 29
Home price gains continued to be strong in June due to the ongoing theme: a tight housing market fueled by low inventories. The S&P CoreLogic Case-Shiller 20-city Index rose 5.7% from June 2016, while month-over-month saw a 0.7% increase from May to June. “Both the number of homes for sale and the number of days a house is on the market have declined for four to five years,” spokesperson David Blitzer said. “Currently the months-supply of existing homes for sale is low, at 4.2 months.” A healthy inventory level is six months.
Renewed tensions in North Korea have sent Mortgage Bond prices to fresh 2017 highs and to the low yields last seen near Election Day 2016. Late yesterday, North Korea launched a missile over Japan, violating Japanese air space and raising uncertainty in the region once again. In response, President Trump says "all options on the table" for North Korea. The headlines are weighing on the U.S. Stock markets, though the Dow Jones Industrial Average, S&P 500 and the NASDAQ are off their worst levels.
The Conference Board reported on Tuesday that its Consumer Confidence Index rose to the highest levels in August to levels not seen in 16 years. The Consumer Confidence Index rose to 122.9, the highest since the 151.3 registered back in July 2001. Americans who view current conditions that as "good" increased, while those who believe current conditions are "bad" declined. Americans stating jobs are “plentiful” rose from 33.2% to 35.4%, while those claiming jobs are “hard to get” decreased from 18.7% to 17.3%.
Monday - August 28
There are no economic reports due for release today as trading gets underway for the last week of August. The rest of the week features data on consumer attitudes, inflation, economic growth, housing, personal spending, manufacturing and the labor market numbers that culminates with Friday's Jobs Report for August. Summer unofficially comes to and on Labor Day, as kids head back to school and vacations ending this week ahead of the long holiday weekend.
The August Jobs Report will be the big news this week where it is expected that U.S. employers added 183,000 new workers during the month. The Jobs report is closely watched by market participants around the globe to gauge the health of the U.S. labor markets. So far this year, job gains have averaged a solid 184,000 new positions each month, weekly initial jobless claims hover near 40-year lows.
U.S. Stocks are near unchanged to begin the week, as investors assessed the impact of Tropical Storm Harvey. Stocks of refiners, pipeline operators, insurers and home improvement retailers will be in focus this week. The storm will drive more that 30,000 people into shelters as the rain continues this week. Early damages are expected to be seen at a staggering $30 billion, placing the dollar value loss among the top eight hurricanes to hit the U.S.
Friday - August 25
Mortgage rates hit year-to-date lows this week and have declined four straight weeks in a row due in part to continued low inflation levels. Freddie Mac reported that the 30-year fixed mortgage rate fell to 3.86% from 3.89% with 0.5 in points and fees. Last year this time the rate was 3.43%. With mortgage rates holding steady, refinancing activity should remain high, particularly for cash out refinancings.
Energy shares will be in focus today as the sector braces for Hurricane Harvey, which could become the biggest storm to hit the U.S. mainland in more than a decade. It is expected to hit the Texas coastline and could bring "life-threatening" amounts of rain up to 35 inches. West Texas Intermediate oil is up modestly to $47.55 per barrel. The national average price for a regular gallon of gasoline is at $2.34, up from $2.28 a month ago.
Thursday - August 24
They may not move mountains, but markets are a possibility in Jackson Hole. The 2017 Economic Symposium, "Fostering a Dynamic Global Economy," kicks off today and will take place Aug. 24-26. Each year since 1978, the Federal Reserve Bank of Kansas City has sponsored the symposium on an important economic issue facing world economies. Participants include prominent central bankers, finance ministers, academics, and financial market participants from around the world. Fed Chair Janet Yellen and European Central Bank President Mario Draghi are schedule to speak tomorrow.
The number of Americans filing for unemployment benefits rose less than expected last week. Initial claims increased 2,000 to a seasonally adjusted 234,000 for the week ended Aug. 19, the Labor Department reported. Claims have now been below 300,000, a sign of a robust labor market, for 129 consecutive weeks. That is the longest stretch since 1970. The August Jobs Report will be released Friday, September 1 with more labor market data on job growth, unemployment, average workweek and hourly earnings. Job growth has been averaging 184,000 new jobs per month in 2017, which is on par with 2016.
Existing Home Sales in July slipped again as large declines in the Northeast and Midwest outweighed sales increases in the South and West, according to the National Association of Realtors® (NAR). Total Existing Home Sales slipped 1.3 percent to a seasonally adjusted annual rate of 5.44 million from a downwardly revised 5.51 million in June. Although July’s sales pace is 2.1 percent above a year ago, it is the lowest of 2017. The median existing home price for all housing types was up 6.2 percent from July 2016, marking the 65th straight month of year-over-year gains. Total housing inventory at the end of July declined 1.0 percent to a 4.2-month supply and is now 9.0 percent lower than a year ago.
Wednesday - August 23
The Commerce Department reported on Wednesday that New Home Sales in July fell by 9.4% to an annualized rate of 571,000 units, a seven month low, and below the 615,000 expected. However, June was revised higher to 630,000 from 610,000. Sales dropped in the Northeast, South and West but rose in the Midwest. Inventories for new homes for sale rose to 5.8 months in July from 5.2 in June, near the healthy rate of six months. From July 2016 to July 2017, sales were down nearly 9%.
Mortgage rates remained near the 2017 lows as reported by the Mortgage Bankers Association (MBA). The MBA reports that the 30-year fixed conforming mortgage rate was steady at 4.12%. In addition, the 30-year jumbo mortgage rate fell to a new low for 2017 of 3.99%, while the FHA fixed mortgage rate was 4.02%. Those rates do carry at least 0.30 in points added on top of the rate. The MBA's Market Composite Index, a measure of total mortgage loan application volume, saw a 0.5% increase in the latest week. The MBA's refinance index rose marginally by 0.3%, while the purchase index declined 1.5%.
On Wednesday night, President Trump said that he will shut down the U.S. government if necessary to build a wall along the border of Mexico, which has put a dent into Stock prices today. President Trump also said he might scrap the North American Free Trade Agreement (NAFTA) to legislate his pro-growth agenda. The president's words are pushing Stock prices lower today, after yesterday's big rally.
Tuesday - August 22
U.S. house prices rose 1.6% in the second quarter of 2017 according to the Federal Housing Finance Agency (FHFA) House Price Index (HPI). House prices were up 6.6% from the second quarter of 2016 to the second quarter of 2017. FHFA’s monthly index for June was up 0.1% from May. “U.S. house prices rose in nearly every state during the second quarter,” said FHFA Senior Economist William Doerner. “New home sales are climbing but, relative to the overall population, they still remain low from a historical perspective. The tight inventory is a major explanation for why house prices have been increasing every quarter over the last six years.”
There are no major economic reports due for release today and it is quiet on the geopolitical front. Expect a quiet summer trading session today with many traders and investors away on vacation. The Jackson Hole Fed-sponsored Symposium kicks off on Thursday and the markets will await speeches from European Central Bank Chief Draghi and Fed Chair Yellen on Friday. New Home Sales will be released on Wednesday and Existing Home Sales on Thursday.
The National Retail Federation (NRF) recently released its expectations for back-to-school spending. The NRF reports that spending for both school and college is projected to hit $83.6 billion, up from last year's $75.8 billion. Families with children in elementary through high school plan to spend an average of $687.72 each, for a total of $29.5 billion. College students and their families are expected to spend an average of $969.88, for a total of $54.1 billion.
Monday - August 21
Traders and investors are looking ahead to this week's big event in the Kansas City Fed-sponsored Jackson Hole, Wyoming Symposium beginning on Thursday and ending Saturday. The Symposium takes on important economic issues facing the U.S. and world economies. Symposium participants include prominent central bankers, finance ministers, academics, and financial market participants from around the world. The participants convene to discuss the economic issues, implications and policy options pertaining to the symposium topic. This year's topic: Fostering a Dynamic Global Economy.
U.S. Stock markets are lower to begin the week and the closely watched S&P 500 Index closed lower on Friday for the second straight week of declines. Stocks have been moving lower due in part to ongoing headlines out of Washington D.C. and the tensions between North Korea and the U.S. The S&P 500 is down a little over 2% since its all-time closing record high on August 8 of 2,474.92. In addition, with the S&P, Dow and NASDAQ near record highs, investors are taking the opportunity to secure some profits.
And this from NASA on today's "Total Solar Eclipse": Today, August 21, 2017, all of North America will be treated to an eclipse of the sun. Anyone within the path of totality can see one of nature’s most awe-inspiring sights - a total solar eclipse. This path, where the moon will completely cover the sun and the sun's tenuous atmosphere, the corona, can be seen, will stretch from Salem, Oregon to Charleston, South Carolina. Observers outside this path will still see a partial solar eclipse where the moon covers part of the sun's disk.
Friday - August 18
Freddie Mac reports that cash sales accounted for around 18% of all home sales in June, below the peak of 35%, but still well above the historical average of 10%. If cash sales remain around 20%, that would translate to $172 billion less in mortgage originations than would occur if the cash share returned to its historical norm. In addition, Freddie reports that Housing Starts were lower than expected in the second quarter of 2017. While starts should improve in the second half of 2017, Freddie Mac expects them to remain well below their long run average at around 1.24 million.
Fannie Mae also reported this week that looming political tensions and the growing potential for a U.S. government shutdown as well as a technical default pose risks to the U.S. economy. Fannie Mae sees full year economic growth (Gross Domestic Product) rising 2%, according to the Fannie Mae Economic & Strategic Research (ESR) Group’s August 2017 Economic and Housing Outlook. Fannie Mae sees slightly stronger economic growth in the second half of 2017, with consumer spending and business investment helping to support growth.
Thursday - August 17
The minutes from the July Federal Open Market Committee meeting were released yesterday revealing a bit of dissension amongst the Fed members, while most are concerned about persistently low inflation levels. In addition, Fed members are not in alignment on when to hike rates, when to trim their $4.5 trillion balance sheet and the effects of low inflation.
The Fed's favorite inflation gauge, the Core PCE, fell to 1.5% annually in the July reading, below the 2% target range. Some members said inflation is likely to remain low and beneath the target range for longer than expected. Fed officials do remain in favor of making some sort of an announcement at the September meeting regarding when the balance sheet will begin to wind down. The Fed's balance sheet is made up of treasury and Mortgage backed securities.
Mortgage rates continued to edge lower this week due in part to low levels of inflation. Freddie Mac reported that the 30-year fixed mortgage rate fell to 3.89% from 3.90% with 0.4 in points and fees. Last year this time the rate was 3.43%. With mortgage rates holding steady, refinancing activity should remain high, particularly for cash out refinancings.
Wednesday - August 16
July Housing Starts fell 4.8% from June to an annual rate of 1.155 million units, below the 1.217 million expected. Homebuilders cite a lack of skilled labor and lots to build on and higher costs for materials for the decline in new home building. Year-over-year starts were down 5.6%.
Building Permits, a sign of future construction, fell 4.1% from June to an annual rate of 1.223 million annualized units, just below the 1.247 million expected. Within the report it showed that single-family starts, which make up the biggest share of the housing market, fell 0.5%, while multi-family dwellings (five or more units) plunged 17.1% from June to July.
Mortgage rates hit their lowest levels in 2017 as reported by the Mortgage Bankers Association (MBA). The MBA reports that the 30-year fixed conforming mortgage rate fell 2bp to a new year-to-date low of 4.12%. In addition, the 30-year jumbo mortgage rate fell 3bp to a year-to-date low of 4.04%, while the FHA fixed mortgage rate slipped 1bp to 4.01%, just above its year-to-date low of 4%. Those rates do carry at least 0.30 in points added on top of the rate. The MBA's Market Composite Index, a measure of total mortgage loan application volume, saw a slight 0.1% increase in the latest week. The MBA's refinance index rose 1.6% and the purchase index declined 1.5%.
Tuesday - August 15
July Retail Sales rose 0.6% versus the 0.3% expected, while June was revised higher to 0.3% from -0.2%. It was the largest increase in seven months as consumers spent on autos and discretionary items. When stripping out autos, sales rose 0.5 percent, above the 0.3 percent expected. Consumer spending makes up about two-thirds of the U.S. economy. The strong numbers could be a positive sign for economic growth moving forward.
Business activity in the New York region rose to its highest level in nearly three years with firms very optimistic about future conditions. The Empire State Manufacturing Survey surged 15 points to 25.2, well above the 13.0 expected. The report revealed that new orders, shipments and labor market conditions all improved early in the month. 42 percent of respondents reported that conditions had improved over the month, while 17 percent reported that conditions had worsened.
Analytics firm CoreLogic reports that strong employment and home price increases have contributed to improved mortgage performance. In addition, tight underwriting over a prolonged period of time has also driven delinquencies lower. The 30-day plus delinquency rate in May 2017 was 4.5%, down from 5.3% in May of 2016. There is one caveat to the positive economic conditions ... a lack of supply which is creating hurdles for potential home buyers.
Monday - August 14
The July Federal Open Market committee meeting minutes will be released on Wednesday at 2:00 p.m. ET and could reveal when the Fed may begin to taper its balance sheet. However, with low inflation levels, the Fed will not be too eager to raise the short-term Fed Funds Rate anytime soon. Fed Fund Futures show a near zero percent chance of a hike to that rate at the September meeting.
The tensions between North Korea and the U.S. are easing a bit this week, which is helping to boost Stock prices after last week's sell-off. Over the weekend, key U.S. officials played down the risk of an imminent war with North Korea. Global Stocks lost nearly $1 trillion in value last week after President Trump warned North Korea that it would face "fire and fury" if it threatened the U.S.
Average gas prices at the pump rose in the latest week with the summer driving season well underway. The national average price for a regular gallon of gasoline rose to $2.35, up from $2.25 a month ago and well above the $2.12 seen last year this time. Motor club AAA says that drivers could see a modest increase in price as the summer drags on. The highest price ever recorded was $4.11 back on July 17, 2008.
Friday - August 11
The Bureau of Labor Statistics reported on Friday that when stripping out volatile food and energy, the Core Consumer Price Index (CPI) was unchanged in July from June. The Core CPI continues to remain tame and has been moving lower since earlier in the year. The Core CPI rose by 1.7% year-over-year and is moving in the opposite direction of where the Fed wants to see inflation. While Core Personal Consumption Expenditures (PCE) is the FedÃ¢ï¿½â¢s favorite inflation gauge, the Core CPI is a close second. The FedÃ¢ï¿½â¢s inflation target is 2.0%, and both the Core PCE (1.5%) and the Core CPI are moving in the opposite direction of that number.
A recent poll of economists by Reuters reveals that the current U.S. economic expansion will continue for at least another two years, but the economy will not grow as much as the Trump administration predicted. Of the 54 surveyed, 34 of those said the expansion has two more years to go, with 21 of the 34 saying it would last at least two to three years and 13 said more than three years. The Trump administration predicted Gross Domestic Product would rise by 3% annually, but the latest poll sees growth of 2.1% to 2.5% each quarter to the end of 2018.
Thursday - August 10
Wholesale inflation in July, as measured by the Producer Price Index (PPI), fell 0.1% versus the 0.2% expected. The Labor Department cited lower costs for energy and service products for the decline in the wholesale inflation. Core PPI, which strips out volatile food and energy, came in at -0.1% versus the 0.2% expected. On a year-over-year basis, PPI fell to 1.9% from 2%. Tomorrow the more closely watched Consumer Price Index will be released for July. Clearly, inflation is not a threat at this time.
The Mortgage Bankers Association (MBA) reported on Thursday that its Builder Application Survey fell 12% in July from June and comes after a 4% decrease in June from May. The survey provides a gauge of new home sales activity in the United States. The MBA also reported an increase in the average loan size for new homes to $329,483 from $527,833. Year over year, applications for new home sales were up 5.1%, though below the 10% annual gain in June and a 20% increase in May.
Mortgage rates continued to edge lower this week as the tensions between North Korea and the U.S. sent investors into the safe haven of the Bond markets and out of risky investments, such as Stocks. Freddie Mac reported that the 30-year fixed mortgage rate fell 3bp this week to 3.90% from 3.93% with 0.5 in points and fees. Last year this time the rate was 3.45%. Low levels of inflation are also helping to keep rates low.
Wednesday - August 9
Tensions are mounting tensions between the U.S. and North Korea. The headlines have pushed investors into the safe haven of the Bond markets and out of risky investments, such as Stocks. President Trump said yesterday that North Korea will be met with "fire and fury" if it threatens the U.S. Reports are surfacing that North Korea is reviewing plans to strike Guam with missiles, which is a U.S. territory with an airfield and naval station.
The Mortgage Bankers Association (MBA) reported on Wednesday that mortgage rates fell in the latest week, matching the YTD lows. The MBA reported that the 30-year fixed conforming mortgage rate fell 3bp to 4.14%, just above the YTD low of 4.13%. The 30-year jumbo rate fell by 4bp to 4.07%, while the FHA rate fell 5bp to 4.02%. Both are near YTD lows. Within the report it showed that the refinance index rose 5%, while the purchase index was up nearly 1%.
Home price gains in the luxury arena surged in the second quarter of 2017 after the shift to modestly lower prices sent sales rising, while sending inventories lower. Luxury home prices jumped 7.5% in the second quarter of 2017 compared to last year, to an average of $1.79 million, according to the latest luxury housing market report by Redfin. Redfin’s analysis tracks home sales in more than 1,000 cities across the country and defines the luxury market as the top 5 percent most expensive homes sold in the city in each quarter. The rise in prices are attributed towards the ongoing theme of a lack of supply of homes for sale on the market.
Tuesday - August 8
The National Federation of Independent Business reports that its Index of Small Business Optimism grew in July after stalling five months, buoyed by strong consumer demand for products and despite the dysfunction in Washington, D.C. The index rose 1.6 points to 105.2, as seven of the 10 components posted a gain, two declined, and one was unchanged. Business owners reported that they have more job openings now as well as plans to hire more workers down the road.
The Labor Department reports that job openings in June rose to a record high 6.16 million from 5.7 million in May while hiring decreased in in JOLTS report (Job Opening and Labor Turnover Survey). Job openings grew in business services, health care, and construction. The hiring rate was little changed from May while hires decrease for educational services.
The solid labor market has improved mortgage performance across the U.S. Analytics firm CoreLogic reports that early-stage mortgage delinquencies are hovering near 17-year lows, and the current-to-30-day past due transition rate remained low at 0.8%. However, the positive economic conditions helping performance have also contributed to a lack of affordable supply, creating challenges for home buyers.
Monday - August 7
Low down payments to purchase homes rose to a seven-year high in June due to the overall growth in purchase lending. Data and analytics firm Black Knight Financial Services reports that over the past 12 months, 1.5 million borrowers have purchased a home using down payments below 10%. The low down payment loans now account for nearly 40% of all purchase origination's.
Fannie Mae reports that housing sentiment dipped in July as high home prices weigh on buyers and economic conditions weigh on sellers. The Fannie Mae Home Purchase Sentiment Index fell 1.5 percentage points in July to 86.8, after matching its all-time high in June. A few key points to the report: The net share of Americans who say it is a good time to buy a home fell 7 percentage points to 23%; the net share of Americans who say that home prices will go up increased by 1 percentage point in July to 47%, following the upward trend from last month. In addition, the net share of Americans who say they are not concerned about losing their job rose by 9 percentage points to 75%, reversing the decrease from last month.
The Census Bureau recently reported that 95% of new households created in the U.S. in the last 10 years were comprised of families that are renting. There were 8.56 million households formed during that time with 8.13 million of those renters. A 2016 Pew Research survey showed that 72% of renters said they would like to purchase a home at some point.
Friday - August 4
The Bureau of Labor Statistics reported that 209,000 jobs were created in July, above expectations of 181,000. Revisions to May and June yielded 2,000 more new jobs than previously reported. The Unemployment Rate fell to 4.3% from 4.4%, the lowest since March 2001. Average hourly earnings rose by 0.3% from June to July, in line with estimates and up from 0.2% in June. Year-over-year wages grew 2.5% compared with 2.4% in June. Overall, it was a good report as the labor market continues to strengthen.
Fannie Mae reported on Thursday that home prices hit an all-time high in the second quarter of 2017, which was above the previous peak in 2006. Home prices were up 2.4% in the second quarter of 2017 from that 2006 period. The gains varied in a big way. North Dakota saw the biggest increase since 2006 of 53.7%, while the growth rate in Nevada fell nearly 25%.
Dunkin' Donuts is looking to shorten its name brand in the coming months to just Dunkin'. The company will be opening a new location in Pasadena, California which will go by the new shortened name. With more than 12,000 stores worldwide, only a handful of locations will be affected in the coming months. A company statement read, “While we remain the number one retailer of donuts in the country, as part of our efforts to reinforce that Dunkin’ Donuts is a beverage-led brand and coffee leader, we will be testing signage in a few locations that refer to the brand simply as 'Dunkin.'”
Thursday - August 3
The Jobs Report for July 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 181,000 new workers, after the 222,000 created in June. The Unemployment Rate is expected to edge lower to 4.3%. Within the report, hourly earnings will be closely watched as wages have been stagnant for quite some time.
Mortgage rates were essentially unchanged this week as borrowing costs continue to remain historically low. Freddie Mac reported that the 30-year fixed rate mortgage was 3.93% this week from 3.92% last week with 0.5 in points and fees. Last year this time the rate was 3.43%. The 15-year fixed rate mortgage fell to 3.18% from 3.20% last week. Last the 15-year rate was 2.74%.
Americans filing for first-time unemployment benefits continue to hover near multi-decade lows as the job market continues to strengthen. Weekly Initial Jobless Claims fell by 5,000 to 240,000, just below the 245,000 expected. First-time unemployment benefits have remained below the 300,000 threshold for 126 straight weeks, the longest stretch since 1970 when the jobs market was smaller.
Wednesday - August 2
Private sector job growth in July edged lower from June with a big surge in the service sector. The report showed that growth has been slipping as July was the second lowest of 2017. ADP reported that private payrolls rose by 178,000 last month, below the 187,000 expected, while June was revised higher by 33,000 to 191,000. Breaking down the numbers by business size; businesses between 50 and 499 workers led the way with 83,000 new workers; small businesses added 50,000; with large companies hiring 45,000 workers.
The Dow Jones Industrial Average opened at a record high of 22,000 this morning fueled by shares of Apple after the iPhone maker reported blowout earnings after the close of trading yesterday. Shares of Apple are trading at an all-time high of $159. The closely watched Stock index is up a whopping 22% since the presidential election in November and up 11% for 2017. The Dow consists of 30 large companies based in the U.S. and was introduced on May 26, 1896 made up of 12 industrial companies. Of the original 12, only General Electric currently remains part of the index.
Amazon announced they will hire 50,000 new workers today at fulfillment centers in certain parts of the country. Job fairs will be held in Baltimore, Maryland, and Buffalo, New York and new workers will be hired on the spot today. Amazon says that 20% will be hired as part-time workers and the rest full-time. The jobs involve picking, packing and shipping of Amazon's products. The company plans to hire 100,000 new workers by mid-2018.