Stocks mostly unchanged from last week’s close – It was a turbulent week on Wall Street! Most of the ups and downs revolved around Greece, which faces a debt default at the end of June. It is feared that they will default on their debt and leave the Euro. There was not much economic news this week, but the few reports were mostly positive. Positive economic news included: a surge in consumer confidence, a sharp rise in retail sales, firming oil prices, and rising producer prices. The Dow Jones Industrial Average closed the week at 17,898.84, almost unchanged from 17,849.46 last week. The Nasdaq closed at 5,051.10 down slightly from 5,068.46 last Friday. The S&P 500 closed at 2,094.11, also about the same as last Friday’s close of 2,092.83.
Bond yields settled a little this week – After weeks of rising rates it was nice to see a stable week. The 10 year U.S. Treasury Bond closed the week at a 2.39% yield, slightly better than 2.41% last week. The 30 year U.S. Treasury Bond closed Friday yielding 3.10%, also about the same as 3.11% last Friday.
Mortgage Rates unchanged from last week– The 30 year fixed rate ended the week around 4.25% for loans up to $417,000, and around 4.38% for loans between $417,000 and $625,500 and 4.50% for loans over over $625,500. The 15 year fixed rate loans are about 3.38% for loans up to $417,000, and around 3.50% for loans between $417,000 and $625,500, and around 3.625% for loans over $625,500. The 5 Year-ARM rates are around 3.10% 1 Year-ARM mortgages are around 2.60%.
Consumer confidence jumps – The University of Michigan consumer sentiment index rose to 94.4 in early June from 90.7 in May. They reported that U.S. consumer confidence surged in early June on expectations that a tightening labor market would spur wage gains, which could further stimulate spending and overall growth later this year. They found that consumers were the most favorable about their personal financial prospects since 2007, with households expecting the largest wage gains since 2008. This rise in consumer sentiment came despite a rise in gas prices, which contributed to the largest rise in producer prices in 2 1/2 years. Strong consumer confidence, together with a tightening labor market, bullish retail sales and firming inflation pressures caped off a week of strong economic data.
U.S. Producer prices record their biggest increase in 2 1/2 years – The Labor Department said its producer price index for final demand increased 0.5% in May, the largest gain since September 2012. Much of the gain was due to rising gas and food products.
Retail sales jump – The Commerce Department reported Thursday that retail sales jumped 1.2% in May. This was encouraging news which beat expectations and showed that Americans sharply stepped up their spending despite harsh weather.
Have a nice weekend!
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