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Market Update May 16th

Market Update May 16th
May 16, 2016 devsite

house and balloons

Although mortgage rates have fallen, mortgage activity continues to remain virtually flat.

  • With the latest decline in rates last week the Mortgage Bankers Association of America reported that applications for purchases and refinances only increased 0.4 percent and 0.5 percent respectively.
  • The good news is that the slight uptick in refinances reverses the prior week’s 6.0 percent decline.

The Labor Department’s JOLTS report, which is the Job Openings and Labor Turnover Survey, showed that job openings in March jumped to 5.757 million.

  • This is the highest number since the recession and one of the highest of all time.
  • Employers are having trouble finding qualified candidates to fill many of open positions.
  • Many of the positions are for lower level jobs however, there seems to be a growing trend of increased openings for managerial and executive positions.

In contrast, the surprise report regarding first time jobless claims was the second large jump in a row.

  • The last week’s report jumped up to a revised 274,000.
  • This week’s report jumped another 20,000 reaching 294,000, which is very close to the psychological 300,000 number that often breeds employment concern.

There does not seem to be any special factors attributing to this increase.

  • Continuing claims are also up in the latest data.
  • The recent increases in initial claims are unsettling but do not yet provide any clear indication of the direction of the job market.
  • Next week’s report is likely to draw more attention.

Last week’s national employment numbers came in far below expectations at only 160,000 for new job creation.

  • Experts were predicting the economy added 200,000

The Bloomberg Consumer Comfort Index is a weekly, random-sample survey tracking Americans’ views on the condition of the U.S. economy, their personal finances and the buying climate.

  • The most recent survey shows that Americans are becoming more and more concerned about the state of affairs of the economy.
  • Although it is not really possible to quantify the impact, without question the disturbingly negative campaigning of the presidential front runners is adding to the angst of the American people.

Gasoline prices at the pump have been rising as the price of a barrel of oil continues to creep upward.

  • The price of a barrel of oil is now over $46.00.
  • Although, it remains less than half of where oil prices had been at the record highs in years past, the rising trend is contributing to consumers pulling back on spending ever so slightly.

Next week’s potential market moving reports are:

  • Monday May 16th – Housing Market Report
  • Tuesday May 17th – Housing Starts, CPI, and Industrial Production
  • Wednesday May 18th – EIA Petroleum Report, FOMC Minutes, and MBA Mortgage Applications
  • Thursday May 19th – First Time Jobless Claims
  • Friday May 20th – Existing Home Sales