Stocks were down for the week, but only slightly, falling sideways, if you will. This seemed to stem from general investor unease over the U.S. budget deficit, the European debt crisis and a mixed reaction to Q1 corporate earnings. Alcoa beat estimates, but revenues were off. JPMorgan Chase topped expectations, but Bank of America missed. Even Google was punished for higher operating costs, while reporting in-line earnings and better than expected revenue. Yet, the 33 S&P 500 companies reporting so far had 7.3% higher sales and 38% better earnings than a year ago.
In other news, Retail Sales were on a roll in March, up 0.4% overall and up 0.8% taking out autos. That's annual sales growth of almost 10%, so the consumer is clearly helping out. On the inflation front, the PPI showed prices for producers continued up in March, though less than anticipated. And these increases were NOT getting passed on to the consumer, since the Core CPI showed prices up just 1.2% from a year ago. However, most economists expect inflation to go up, and with that comes higher interest rates, so home buyers and refinancers should not be too complacent about today's low rates.
For the week, the Dow ended down 0.3%, at 12,342; the S&P 500 was off 0.6%, to 1,320; and the Nasdaq was also off 0.6%, ending at 2,765.
There were some solid gains in the bond market, supported by the better than expected inflation readings. There was also some safe-haven bond buying coming off European concerns, after Moody's downgraded Ireland's debt. The price of the FNMA 4.0% bond we watch ended the week up .96, closing at $98.15. In spite of this, national average rates for conforming mortgages edged up in Freddie Mac's weekly survey. But rates remain historically low, "helping to maintain affordability in the housing market," according to Freddie Mac's Chief Economist.
From my weekly enewsletter for real estate pros, INSIDE LENDING, for the week of April 18, 2011.
Comments(0)