Dow dropped 217, decliners over advancers 4-3 & NAZ crawled up 6. The MLP index edged higher in the 226s & the REIT index was off 2+ to the 281s. Junk bond funds fluctuated & Treasuries were sold (more below), taking yields higher. Oil added 2+ to 80 & gold inched up 2
AMJ (Alerian MLP index tracking fund)
Home prices declined again in Sep as higher rising mortgage rates sapped demand from the housing market. Prices slid 1% nationally in Sep from Aug, the 3rd consecutive monthly decline, the S&P CoreLogic Case-Shiller index showed. On an annual basis, the index climbed 10.6% in Sep, down from a 12.9% rate the previous month. "As the Federal Reserve continues to move interest rates higher, mortgage financing continues to be more expensive and housing becomes less affordable," Craig Lazzara, managing director at S&P Dow Jone Indices, said. "Given the continuing prospects for a challenging macroeconomic environment, home prices may well continue to weaken." The 10-city composite, meanwhile, climbed 9.7% annually, down from 12.1% in Aug & the 20-city composite rose 10.4% in Sep, following a gain of 13.1% the previous month. Price growth slowed in all 20 cities. re still steeper than just one year ago. The median new house price climbed nearly 15.4% in Oct from the year-ago period to $493K, according to a separate report last week from the National Association of Realtors. That is also up more than 8% from Sep. The interest rate-sensitive housing market has borne the brunt of the Federal Reserve 's aggressive campaign to tighten policy & slow the economy. Policymakers already lifted the benchmark federal funds rate 5 consecutive times & have shown no sign of pausing as they try to crush inflation that is still running near a 40-year high. Combined with high home prices, the rapid rise in borrowing costs has pushed many entry-level homebuyers out of the market.
US home prices tumble for third straight month
Private payroll job growth
slowed sharply in Nov evidence that the historically hot labor
market is finally starting to cool off, according to the ADP National
Employment Report. Companies added just 127K jobs last month, missing the 200K gain that economists surveyed by Refinitiv had predicted. The
weaker-than-expected report comes as the Federal Reserve wages the most
aggressive fight since the 1980s to crush inflation & slow the labor
market with a series of rapid interest rate increases. "Turning
points can be hard to capture in the labor market, but our data suggest
that Federal Reserve tightening is having an impact on job creation and
pay gains," said Nela Richardson, chief economist at ADP. "In addition,
companies are no longer in hyper-replacement mode. Fewer people are
quitting and the post-pandemic recovery is stabilizing." The bulk of the gains in Nov stemmed from the leisure &
hospitality industry, which added 224K new workers. Trade,
transportation & utilities followed with 62K hires, trailed by
education & health services with an increase of 55K. The
biggest losses, meanwhile, were in the manufacturing industry, which saw
payrolls decline by 100K. Professional & business services lost
77K jobs & financial activities shed 34K. By size, only
medium businesses that employ between 50-499 workers that led job gains last
month, with an increase of 246K. Large firms lost 68K workers,
while small businesses, which have struggled the most with the worst
inflation in 4 decades, shed 51K0 workers.
Companies added fewer jobs, well below economists' estimate
The 10-year Treasury yield whipsawed following new jobs & GDP data while as investors awaited a key speech from Federal Reserve Chair Jerome Powell later in the day that could provide clues on monetary policy going forward. The benchmark rate traded 4 basis point higher at 3.792% & the 30-year bond yield gained nearly 4 basis point to 3.838%. Yields & prices move in opposite directions. One basis point is equal to 0.01%. Investors scan economic data for hints about the impact of the Fed's interest rate hikes on the US economy as tightness in the labor market is often associated with high inflation. The figure could therefore also inform the central bank' s policy decisions.
10-year Treasury yield rises on GDP revision as investors await Powell speech
Economic data is coming in mixed. But Powell gives a speech later today which could be helpful for investors.
Dow Jones Industrials
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