Dow went up 11, advancers over decliners about 5-4 & NAZ lost 14. The MLP index was little changed in the 179s & the REIT index rose 2+ to the 429s. Junk bond funds fluctuated & Treasuries were sold again. Oil rose to the 64s & gold pulled back 11 to 1762.
AMJ (Alerian MLP index tracking fund)
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Gross domestic product (GDP) – the broadest measure of economic performance – grew at a 6.4% annual rate during the first qtr, according to an advance estimate released by the Commerce Dept, outpacing the 6.1% growth that that was forecast. The initial reading shows an improvement from the final qtr of last year when the economy grew at a 4.3% annualized rate. Boosting growth in the Q1 were gains in personal consumption expenditures, nonresidential fixed investment, federal gov spending, residential fixed investment, & state & local gov spending. Those gains were partially offset by decreases in private inventory investment and exports. Imports, which are subtracted when calculating GDP, increased.
US economy grows at 6.4% as reopening gains steam
Jobless benefit claims fell to 553K last week from a revised 566K a week earlier, the Labor Dept reported. With the revisions, this is the lowest level of claims since the pandemic struck last year. The forecast had been looking for a drop to 528K new claims. Claims in the prior week were revised from the initial estimate of 547K. The 4-week moving average for claims, which smooths out volatility, fell 44K to 611K, the lowest level since Mar 2020. Texas & Wisconsin had big drops in claims last week while Virginia, Rhode Island. Michigan & West Virginia experienced sizable gains. Applications for benefits were filed last week through a temporary relief program fell by 11K to 122K. The number of people already collecting the traditional unemployment benefit increased a slight 9K to a seasonally adjusted 3.7M in the latest week. Workers getting extra benefits thru an emergency program funded by the federal gov fell 413K to 5.2M. Workers can claim these benefits until Sep. Taken together 16.5M people were collecting benefits from 8 separate state & federal programs, down from 17.4M in the prior week. Jobless claims are a proxy for layoffs. Claims have been trending lower as the economy reopens & the labor market improves. Economists think this trend will continue.
U.S. jobless-benefit claims sink 13,000 to pandemic low 553,000
Pending home sales, a measure of signed contracts on existing homes, rose 1.9% in Mer compared with Feb, according to the National Association of Realtors. The forecast expected a 5% gain. Pending sales were 23.3% higher than Mar 2020, but that annual comparison is skewed widely because the housing market essentially ground to a halt last Mar at the start of the pandemic. The market then rebounded strongly last summer & is still showing incredibly strong demand. Pending home sales are a forward-looking indicator of closed sales in 1-3 months. “Low inventory has been a consistent problem, but more inventory will show up as new home construction intensifies in the coming months, as well as from a steady wind-down of the mortgage forbearance program,” said Lawrence Yun, chief economist for the Realtors. “Although these moves won’t immediately replenish low supply, they will be a step forward.” Home prices, already sky-high, are continuing to rise at a pace not seen in over 15 years. Strong demand & record-low supply are fueling bidding wars across the nation. Prospective buyers have lost purchasing power due to rising mortgage rates, which climbed steadily since the start of the year & more so during Mar. The average contract rate on the popular 30-year fixed mortgage started the month at 3.22% & ended around 3.45%, according to Mortgage News Daily. It started the year at 2.76%.
Pending home sales rose less than expected in March as prices soared
Stocks began trading with strong buying, but that enthusiasm did not last. Currently markets are around breakeven. More earnings will be reported which should influence trading. Biden's speech had no major surprises, it called for more spending on pet projects while huge deficits are of no concern.
Dow Jones Industrials
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