Stock markets post their biggest weekly increase in nearly two years to gain back last week’s largest decline in two years and more! – The US stock markets posted its largest weekly gain in over two years. The rally was attributed by investors to a statement by the Federal Reserve that they would be patient on raising interest rates, following a two day policy meeting. It was widely viewed that after so much positive economic news the Fed would be raising rates soon. Also higher than expected holiday sales, lower jobless claims, low inflation, and better than expected corporate earnings impacted the market. The Dow Jones Industrial Average closed the week at 17,804.8 up sharply from 17,280.83 last week. The S&P 500 closed Friday at 2,070.65 well above its close of 2,002.33 last Friday. The NASDAQ closed at 4,765.38 also sharply higher than last weeks close of 4,653.60.Treasury Bond Rates were slightly higher– The 10 year Treasury bond closed the week at 2.17% which was higher than the 2.10% close last week. The 30 year treasury yield was 2.77% about the same as 2.75% last week. As The treasury yield is considered a benchmark rate as mortgages rates follow treasury trends.Mortgage Rates – The Freddie Mac Primary Mortgage Survey reported that the 30 year fixed mortgage rate average for the week was 3.8% down from 3.93% last week. The 15 year fixed was 3.09% down from 3.20% last week. Rates rose with stock later in the week so next week’s rates will be closer to 4% for the 30 year and 3.25% for 15 year loans.
Consumer Prices drop in November– The Labor Department reported that the cost of living fell 0.3% in November. It marked the largest monthly drop since December 2008. The annual gain in consumer prices rose 1.3% in the last 12 months. This was well below the Federal Reserve’s inflation target rate. Much of this drop was attributed to the lowest gasoline prices since 2009.
California adds 90,000 jobs in November! – The state added 90,000 jobs in November. This was 3 times the monthly average over the last two years. California’s unemployment rate dipped to 7.2% in November. It was 8.4% one year ago. Every sector showed job gains for the month. The state has added 344,000 jobs in the past year.
DataQuick shows prices up but number of sales drop drastically. – DataQuick reported that 29,459 new and resale houses and condos closed in California in November. This number was down 20% from the 36,830 recorded in October, and down 11.9% from the 33,429 recorded in November 2013. Southern California had 15,643 recordings, down 18.8% from October. The southern California median price was up .5% to $412,000 from $410,000 in October. California as a whole showed a median price of $381,000, down .3% from October, but up 5.8% from last year. It was the 33rd consecutive month of year over year monthly increases. Obviously, we do not have many homes in our market at the median price level, but another report showed that the higher end markets are experiencing larger increases than those at the median price range levels. That is obvious in our higher end markets!
US Jobless Claims– The number of Americans filing new claims for unemployment benefits unexpectedly fell last week, suggesting that the labor market is continuing to gain strength. Initial claims dropped 6,000 to a seasonally adjusted 289,000 for the week ending December 13, according to the labor department.
It is still very busy out there! Let’s keep working. It is a unique holiday season and it looks like buyers are going to be looking throughout the month. It’s unlike any December I can ever remember!
Have a great weekend!
If you’d like more information on the San Fernando Valley or Los Angeles, or to have help looking for your next home, please feel free to reach out! I’m happy to help, no obligation.