Dow was off 62 after starting the day in the black, decliners over advancers 2-1 & NAZ fell 36. The MLP index dropped 4+ to the 192s & the REIT index edged up 1 ti the 453s. Junk bond funds drifted lower & Treasuries were heavily bought, taking the yield on the 10 year Treasury down a very big 7 basis points to 1.3% (5 month low). Oil was off almost 2 to the 71s & gold gained 10 to1804.
AMJ (Alerian MLP index tracking fund)
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The real estate market continues to notch what experts are characterizing as
unprecedented levels of price growth, after another month of gains was
recorded in May. May's home price growth rate overtook Apr's at an annualized pace
of nearly 18%, compared with 14.8% the month prior, according to a new
report from data analytics firm Black Knight. May marks the 3rd consecutive month that the growth rate for home prices hit an all-time high. "Frankly, home values are appreciating at rates we’ve simply never seen
before, as low interest rates, ultra-scarce inventory and increasingly
competitive homebuyers combine to create a truly unprecedented market,"
Black Knight's Data & Analytics Pres Ben Graboske said. Early data the firm is tracking from Jun suggests further growth is likely. May's 2.1% monthly increase in home prices is also the largest monthly increase ever.
US home prices continue to rise at record rates
Mortgage demand fell for the 2nd week in a row, as low inventory & high home prices continue to weigh on the housing market. Mortgage applications decreased 1.8% last week, according to the Mortgage Bankers Association's (MBA) seasonally adjusted index, falling to the lowest level since the beginning of 2020, before the coronavirus pandemic started to take a toll on the economy. Both refinance & purchase applications took a hit, even as mortgage rates slipped. Mortgage applications to refinance a home dropped 2% for the week & were 8% lower than a year ago. Refinance applications have trended lower than 2020 levels for the past 4 months, according to the MBA. Home purchase applications dropped 1% for the week & came in 14% lower than a year ago. “Swift home-price growth across much of the country, driven by insufficient housing supply, is weighing on the purchase market and is pushing average loan amounts higher,” said Joel Kan, MBA's associate VPt of economic & industry forecasting. Falling mortgage rates didn't spur demand. The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($548K or less) dropped 5 basis points to 3.15%, with points decreasing to 0.38 from 0.39 (including the origination fee) for loans with a 20% down payment. Mortgage rates loosely follow the yield of the 10-year Treasury. Mortgage rates dipped despite good economic news, Kan added.
Mortgage applications sink to their lowest level since before the pandemic hit
American Airlines (AAL) flew 2.7M people over the Jul 4 holiday weekend, almost 3
times as many as last year as customers continue to return to travel. The
carrier operated more than 26K mainline & regional flights, more
than double its capacity a year ago, COO David Seymour said. No comparison was made to Jul 2019, before the pandemic began,
but nationwide, fewer travelers passed thru US airports compared
with 2 years ago. The Transportation Security Administration
screened 10M people in the first 5 days of Jul, down by about
17% from the 12.2M people that passed thru airport security
over the same period 2 years ago. AAL increased its schedules more than competitors. Last month AAL trimmed its schedule for the first ½ of Jul by about 1% (around 1000 flights) to avoid disruptions due to weather & staffing shortages. The airline hired 300 customer operations employees at its Dallas/Fort
Worth Intl Airport hub “and we’re continuing those efforts
across the board,” Seymour said. The stock fell 66¢.
If you would like to learn more about AAL, click on this link:
club.ino.com/trend/analysis/stock/AAL?a_aid=CD3289&a_bid=6ae5b6f7
American Airlines says it flew three times as many passengers over July 4 weekend compared with 2020
Traders are anxious to hear what the last Fed meeting notes have to say about projections for the economy & interest rates. There is a lot going on in the housing market (shown above). AAL recent data sends a positive message about the airline industry going forward,
Dow Jones Industrials
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