Find this article at: http://money.cnn.com/2009/07/27/real_estate/June_new_home_sales/index.htm |
Monday, July 27, 2009
New Home Sales: "Really Good News"
Friday, July 17, 2009
Housing Starts Rose in June
Treasurys ease on housing dataGovernment bond prices fall after a report showed that housing starts rose in June, a positive sign for the staggering housing market.July 17, 2009: 1:05 PM ET NEW YORK (Reuters) -- U.S. Treasury prices fell Friday after the government said U.S. housing starts rose in June, bolstering prospects for economic recovery and damping demand for safe-haven U.S. government debt. Talk of a buyer for struggling CIT Group Inc (CIT, Fortune 500), a U.S. lender to hundreds of thousands of small- and medium-sized businesses, added to pressure on Treasurys, traders said. "Housing starts, without a doubt, are why the market is down," said William Sullivan, chief economist at JVB Group in Boca Raton, Florida. "We were trading up overseas until 8:30 a.m. (EDT) when we got news of this surprising rebound in housing starts and building permits. That's viewed as a healing process in the economy which in turn reduces the demand for liquidity assets such as Treasury securities." New U.S. housing starts rose a bigger-than-expected 3.6%, propelled by a 14.4% rise in single-family home starts, the Commerce Department said, the latter the biggest rise since December 2004. Benchmark 10-year Treasury notes fell 18/32 in price in mid-morning trade, their yields rising to 3.65% from 3.56% late Thursday. "This is another piece of data for those who see the recession ending soon," said William O'Donnell, head treasury strategist at RBS Securities in Greenwich, Connecticut. An end to the recession would tend to favor riskier investments like stocks and corporate bonds, rather than safe-haven Treasurys. Economists generally view the manufacturing sector as slowly stabilizing so the possibility of an end to the recession in the housing sector would neutralize what has been a big contributor to the steepest downturn in the economy since the Great Depression. "The housing starts rise is very convincing evidence of the potential for the general housing market to improve," Decision Economics senior economist Pierre Ellis in New York. Traders and analysts said speculation about a possible buyer for CIT Group Inc. also weighed. "If there's some deal worked out on CIT that's a mild negative for Treasurys because it reduces that flight to safety and quality," Sullivan said. CIT declined to comment on a report that JPMorgan Chase & Co (JPM, Fortune 500) was a suitor for its factoring unit. John Spinello, senior vice president and chief fixed-income technical strategist at Jefferies & Co. in New York, said the market could be overreacting a bit to the housing data. "(Housing starts) were good. No question. It was the first time we saw multiple months of increase since 2007, but they're still at very low levels," he said. But thin summer, pre-weekend trading could be exaggerating the market's move, Spinello said. "The market is a little bit thin. We expect the 3.63% (level of the 10-year yield) to hold and draw some buyers," Spinello said. "Right now with no supply in the marketplace, we could probably range-trade into supply." The Treasury's next auction of anything other than short-term debt is July 27 when the government sells 20-year TIPS. It will sell two-year notes on July 28. Two-year Treasury notes were down 1/32 in price Friday, their yields rising to 1.01% from 0.98% Thursday. Five-year Treasury notes fell 9/32 in price, their yields rising to 2.51% from 2.44% late Thursday. Thirty-year Treasury bonds fell 28/32, their yields rising to 4.50% from 4.44% Thursday. |
Find this article at: http://money.cnn.com/2009/07/17/markets/bondcenter/bonds.reut/index.htm |
Thursday, July 9, 2009
Fewer than expected file for unemployment
Labor Department says first time jobless claims fell by 52,000 last week to 565,000. But continuing claims rose to another record high.
NEW YORK (CNNMoney.com) -- The number of Americans filing initial unemployment claims fell sharply last week, while those filing ongoing claims rose to another all-time high, according to government data released Thursday.
There were 565,000 initial jobless claims filed in the week ended July 4, down 52,000 from a revised 617,000 the previous week, the Labor Department said.
It was the lowest number since January and was below the consensus estimate of 603,000 from economists surveyed by Briefing.com.
Analysts said last week's drop was distorted by a change in the pattern of seasonal layoffs in the automotive industry.
Initial claims typically spike in July as automakers idle certain manufacturing plants, and the Labor Department adjusts its data for such seasonal factors.
However, many plant closures occurred early this year, said Mark Vitner, an economist at Wacovia Economics Group.
On a non-seasonally adjusted basis, initial claims were 577,506.
"The improvement in first week of July was exaggerated by the timing of plant closures," Vitner said. "This is something we're going to be dealing with throughout the month."
Meanwhile, the number of people requesting continued jobless benefits rose to a record high, indicating that the labor market remains weak.
The government said continuing claims rose to 6,883,000 in the week ended June 27, the most recent data available.
That's an increase of 159,000 from the previous week's revised total of 6,724,000 and was the highest reading since the Labor Department began keeping records in 1967.
The 4-week moving average of continuing claims rose 12,000 to 6,769,000.
The ongoing rise in continuing claims suggests that more workers are struggling to re-enter the work force.
"While layoffs have topped out, hiring has not picked up," Vitner said. "The increase in unemployment rate going forward will be more a result of lack of hiring rather than layoffs," he said.
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Friday, July 3, 2009
Mortgage rates slide
The 30-year and 15-year fixed tick down on signs of continued economic weakness.
NEW YORK (CNNMoney.com) -- Home mortgage rates retreated last week, with the 30-year fixed slipping to 5.7% from 5.8% the week prior, according to a report from a financial data aggregator released Thursday.
The average 15-year mortgage rate also fell, dipping to 5.07% from 5.16%, according to the weekly national survey from Bankrate.com.
Mortgage rates fell to month-ago levels "as evidence mounts of continued economic weakness," the report said, citing troubling recent data on unemployment, GDP and consumer spending.
"Rates are likely to bob up and down as concerns alternate between economic weakness and future inflation," the report said. "Spurts of volatility should be expected, especially given the uncertain economic and financial climate."
A related report this week said home prices fell 18.1% from a year earlier, but the change from March narrowed sharply in a possible sign that housing markets may be starting to turn.
Current rates remain much lower than last year's levels, when the average 30-year fixed mortgage rate was 6.53%, according to Bankrate.com.
At the current rate of 5.7%, the monthly payment on a $200,000 mortgage would be $1,160.80, or about $107 less than the monthly payment at last year's rate of 6.53%.
Other rates: The average jumbo 30-year fixed rate ticked up to 6.67% from 6.96%. Loans are considered "jumbo" when they are too large to be purchased or guaranteed by Fannie Mae (FNM, Fortune 500) and Freddie Mac (FRE, Fortune 500).
Adjustable-rate mortgages were mixed, the report said, with the average 1-year ARM ticking up to 5.17% and the 5-year ARM falling to 5.17% from 5.26%.