Dow slid back 145, decliners over advancers 2-1 & NAZ went up 84. The MLP index stayed near 237 & the REIT index dropped 3+ to the 354s as yields rose. Junk bond funds fluctuated & Treasuries were sold bringing higher yields. Oil inched higher in the 81s & gold was off 1 to 1914.
AMJ (Alerian MLP Index tracking fund)
Treasury yields climbed as investors braced themselves for comments from Federal Reserve officials & economic reports expected throughout the week. The yield on the 10-year Treasury was up by more than 4 basis points at 4.29%, trading near levels last seen in 2022 & the 2-year Treasury yield was trading over 2 basis points higher at 4.97%. Yields & prices move in opposite directions & 1 basis point equals 0.01%. On the data front, investors will closely follow the latest existing & new home sales reports & durable goods orders figures which are slated for this week. Elsewhere, China's central bank cut its one-year loan prime rate by less than expected while leaving its 5-year rate unchanged. That comes after the People's Bank of China announced surprise interest rate cuts last week as weak economic data raised concerns about the state of the economy.
10-year yield climbs as investors await Fed speaker comments, economic data
One thing's for sure about people who reach that rarefied status in their workplace retirement accounts, they are not easily spooked. They stayed the course over decades of stock market turbulence, riding the ups and downs to becoming 401(k) millionaires. New data from Fidelity Investments found the number of employees with 401(k) balances over $1M spiked 26% in Q2 to 378K, compared with 299K at the end of 2022. The average 401(k) balance for these investors was $1.5M. Fidelity Investments, one of the largest managers of workplace retirement plans, tracks the number of accounts with balances equal to or over $1M. “We found that a growing number of people understand that saving for retirement is a marathon, not a sprint,” said Mike Shamrell, Fidelity's VP for workplace thought leadership. Fidelity's 401(k) & IRA millionaires club is relatively small, 1.6 & 2.5% of Fidelity's investors in those categories, respectively, but it's growing again after falling for most of 2022. The number of workers with $1M or more in their 401(k)s and IRAs hit all-time highs of 442K & 376K respectively at the end of 2021, with a median balance of $1.3M for those investors. The news was good for non-millionaire investors as well, average retirement account balances climbed for the 3rd straight qtr. Overall, retirement investors have showed resilience as account balances have seesawed, Shamrell said.
Mortgages in delinquency returned to a historic low in May, while foreclosures remained at an all-time low, according to the latest mortgage delinquency report from CoreLogic. Only 2.6% of US mortgages were in a state of delinquency in May, marking a slight decrease from 2.7% of mortgages last year. "May’s overall mortgage delinquency rate matched the all-time low, and serious delinquencies followed suit," CoreLogic Principal Economist Molly Boesel said. "Furthermore, the rate of mortgages that were six months or more past due, a measure that ballooned in 2021, has receded to a level last observed in Mar 2020. A very strong job market continues to help borrowers pay their mortgages on time," Boesel continued. "The U.S. economy has added nearly 25 million jobs since April 2020 and about 4 million in the last year. As a result, the unemployment rate has ranged from 3.4% to 3.7% for the past 16 months. While the job market may slightly weaken over the next year, we project that mortgage performance will remain healthy." Delinquency is categorized as mortgages that are 30 days or more past due.
Mortgage delinquency rates return to record low: CoreLogic
The next 2 weeks generally feature quiet trading with some traders away on holiday. Of course, Aug has been a tough time for stocks after its latest rally.
Dow Jones Industrials
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