Despite the week being filled with a number of potential market moving reports, for the most part the investor reaction remained fairly subdued. The concern and market trepidation over what is happening in Russia has been on investor’s minds. The market is up more than 150 points through the Thursday.
This week’s existing housing report: For the sixth time in seven months, sales of existing homes declined. The most recent report showed a contraction of 0.4 percent in February following a very severe 5.1 percent drop in January. Harsh weather in the North East and Mid-Atlantic states is believed to be the main factor for the decline. From the same time last year, existing home sales are down 7.1 percent, which is the steepest decline in nearly 3 years. The slow pace of sales is easing supply constraints as which increased to 5.2 months from 4.9 months.
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The other piece of major news investors had their eye on for the week was the Federal Open Market Committee’s announcement on monetary policy released Wednesday. The announcement came with little surprise however, the message disappointed some investors. The FOMC announced that they are going to continue to cut their bond buying stimulus program by $10 billion per month and that as of now the plan is to have the program ended by December 31st. Investors, although not surprised by the announcement, were hoping that the Fed might state that they plan to keep the program going longer in order to maintain the artificially low borrowing rates.
The second major component of the Fed announcement on monetary policy is that they are not going to necessarily change the plan based upon the Department of Labor’s monthly unemployment report. In prior months, the plan for making changes to monetary policy was based upon the unemployment rate. Wednesday’s announcement from the Fed indicated that they would take a more broad view on the economic recovery to make decisions regarding changes in monetary policy.
Joke for the day: Sam walks into his boss’s office. “Sir, I’ll be straight with you, I know the economy isn’t great, but I have over three companies after me, and I would like to respectfully ask for a raise.” After a few minutes of haggling the boss finally agrees to a 5% raise, and Sam happily gets up to leave. “By the way”, asks the boss as Sam is getting up, “which three companies are after you?” “The electric company, water company, and phone company”, Sam replied.
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Next week the potential market reports are:
- Tuesday March 25th -New Home Sales, FHFA House Price Index, Case-Shiller HVI
- Wednesday March 26th – MBA Applications and Durable Goods Orders
- Thursday March 27th – First Time Jobless Claims and GDP
- Friday March 28th- Personal Income and Outlays
As your mortgage professional, I am happy to assist you with any information you may need regarding mortgage or real estate information. I welcome the opportunity to serve you in any way I possibly can, 661-505-4300.
Source: Santa Clarita News