Archive for November, 2009

Stocks turn higher to extend month's big gains -

The stock market ended November with its best monthly performance since the summer — even as investors worried about the strength of the holiday shopping season.

Stocks zigzagged Monday but finished modestly higher as traders ultimately were not deterred by reports that retail sales were overall uninspiring during the Thanksgiving weekend. Retailers including Macy's Inc. and Saks Inc. fell sharply but online merchants like Amazon.com Inc. shot higher on reports of strong Internet sales.

Despite the tepid finish, the Dow Jones industrial average and the S&P 500 index rose more than 5 percent in November, their biggest monthly advance since July.

Obama Addministration "Shames" Mortgage Servicers -

HUD and the Treasury Department are taking another crack at moving its foreclosure prevention efforts from concept to reality. And now it is adding "shame" to its list of weapons.

The Treasury Department announced today that it intends to increase pressure on lenders and servicers to move borrowers from trial loan modifications into actual restructured loans. The action comes amid reports that the administration's $75 billion Making Homes Affordable Program (HAMP) is floundering.

While the government has been trumpeting the success of the trial modification program - some 650,000 troubled borrowers had entered the program by the end of October - only a very small percentage of those borrowers have transitioned into a permanent loan modification. It is estimated that November figures will show completed modifications to number in only the tens of thousands coming out of close to ¾ million trials.

The Treasury has announced plans to assign officials to monitor the largest mortgage servicing companies on a daily basis and will require companies to develop and report their specific plans to increase the number of modifications they complete. Loan servicers may face monetary penalties and sanctions if they fail to fulfill plans. Treasury is also expected to delay incentive payments to servicers until individual modifications are permanent

Dow Hits New '09 High Ahead of Holiday - CNNMoney.com -- Stocks climbed Wednesday in a thinly-traded session ahead of Thanksgiving, as investors welcomed a bigger-than-expected drop in weekly jobless claims.
 
All financial markets are closed Thursday for the holiday, while Friday brings an abbreviated session for stocks. Some market pros will make a five-day weekend of the period.
 
The Dow Jones industrial average rose 31 points, or 0.3%, ending at a fresh 13-month high. The S&P 500 rose 5 points, or 0.5%, and also finished at a fresh 13-month high.
 
The Nasdaq composite rose 7 points, or 0.3%, closing short of a 13-month high.
 
Because of the holiday, all the week's news was jammed into the first three days, with nothing on the docket Friday. The combination of a three-day onslaught of economic news and some pre-holiday wariness was keeping investors from moving much on Wednesday.
 
Home Sales Surge - A combination of factors helped mortgage rates improve yet again during the short Thanksgiving week. Strong demand for the Treasury auctions, low inflation, and a fragile economy were all positive for mortgage markets. As a result, mortgage rates dropped to the lowest levels since January. 
 
The consensus economic outlook is for a gradual recovery with low inflation, and the economic data released during the week was consistent with this view. Economic growth during the third quarter of the year was revised lower, but both the Fed and private economists raised their forecasts for future growth. This week's economic reports indicated that some sectors of the economy are improving, such as the housing market (see below), while others reflected weakness. Wednesday's data on Core PCE prices continued to show little inflationary pressure, which allows the Fed to keep rates low to assist the economic recovery. 

Stocks End Choppy Day Lower - CNNMoney.com -- Stocks ended a volatile session with modest losses Tuesday, as the Fed's improved outlook and some signs of improvement in housing tempered a weaker revision on economic growth released in the morning.

The Dow Jones industrial average lost 17 points, or 0.2%. The Dow ended the previous session at its highest level since Oct. 2, 2008.

The Nasdaq composite lost 7 points, or 0.3%, while the S&P 500 was barely changed.
Stocks slipped Tuesday morning after a report showed third-quarter GDP grew at a slower pace than initially reported.

S&P/Case Shiller: Home Prices Improving at Slower Pace - U.S. home prices, as measured by the 20 city index rose by 0.3% on a month over month basis, less than the anticipated 0.8% gain. The 10-city index rose 0.4% from August. According to S&P/Case Shiller data, home prices have risen for five straight months.

Mortgage Rates Move Lower - Rates moved higher in the opening hours of the session, however as losses were recovered later in the day, several lenders reissued rate sheets, passing along better pricing, by day's end.

Reports from fellow mortgage professionals indicate rate sheets to be marginally improved this morning. The par 30 year conventional rate mortgage has fallen to the 4.50% to 4.75% range for well qualified consumers.

If you are seeking a 15 year fixed rate, you should expect a par interest rate in the 4.125% to 4.375% range.

Stocks End Choppy Day Lower - CNNMoney.com -- Stocks ended a volatile session with modest losses Tuesday, as the Fed's improved outlook and some signs of improvement in housing tempered a weaker revision on economic growth released in the morning.

The Dow Jones industrial average lost 17 points, or 0.2%. The Dow ended the previous session at its highest level since Oct. 2, 2008.

The Nasdaq composite lost 7 points, or 0.3%, while the S&P 500 was barely changed.
Stocks slipped Tuesday morning after a report showed third-quarter GDP grew at a slower pace than initially reported.

S&P/Case Shiller: Home Prices Improving at Slower Pace - U.S. home prices, as measured by the 20 city index rose by 0.3% on a month over month basis, less than the anticipated 0.8% gain. The 10-city index rose 0.4% from August. According to S&P/Case Shiller data, home prices have risen for five straight months.

Mortgage Rates Move Lower - Rates moved higher in the opening hours of the session, however as losses were recovered later in the day, several lenders reissued rate sheets, passing along better pricing, by day's end.

Reports from fellow mortgage professionals indicate rate sheets to be marginally improved this morning. The par 30 year conventional rate mortgage has fallen to the 4.50% to 4.75% range for well qualified consumers.

If you are seeking a 15 year fixed rate, you should expect a par interest rate in the 4.125% to 4.375% range.

Existing Home Sales Surprise to Upside - Existing-home sales surged 10.1 percent to an annual rate of 6.10 million units in October from a downwardly revised pace of 5.54 million in September. Sales activity is at the highest pace since February 2007 when it hit 6.55 million. Total housing inventory at the end of October fell 3.7 percent to 3.57 million existing homes available for sale, which represents a 7.0-month supply at the current sales pace, less than the revised for the worse 8.0-month supply which was reported in September. The national median existing-home price for all housing types was $173,100 in October, down 7.1 percent from October 2008.

Dow spikes to 13-month high - A better-than-expected housing market report, a weak dollar and a surge in commodities are pushing the market to new 2009 highs.

The Dow Jones industrial average gained 133 points, or 1.2%, closing at 10,450.95, its highest point since October 2, 2008. The Dow rose as much as 177 points in the morning, hitting 10,495.61 -- the highest trading level since Oct. 3, 2008.

The Nasdaq composite climbed 30 points, or 1.4%, closing short of a 13-month high hit last week. The S&P 500 jumped 15 points, or 1.4% but ended short of its 13-month high hit last week.

Mortgage loans: Record number are late - CNNMoney.com -- Mortgage borrowers are still falling behind on their payments in record numbers, despite the many foreclosure prevention efforts initiated by the government and non-profits.

In the third quarter, 9.64% of all mortgage loans were delinquent, according to a report released on Thursday by the Mortgage Bankers Association. That represents 4.5 million borrowers and is an increase from 9.24% in the prior three months.

"Despite the recession ending in mid-summer, the decline in mortgage performance continues," said Jay Brinkmann, MBA's chief economist. "Job losses continue to increase and drive up delinquencies and foreclosures because mortgages are paid with paychecks, not percentage point increases in GDP."

The delinquency rate includes all mortgage loans that are at least one payment past due but does not include loans in some stage of foreclosure.

The combined percentage of loans in foreclosure or at least one payment past due was 14.41% on a non-seasonally adjusted basis, the highest ever recorded in the MBA delinquency survey.

Stocks drop for second straight day - Stocks tumbled for the second day in a row Thursday as concerns about the economic recovery resurfaced.

The Dow Jones industrial average fell 94 points, or 0.9%, to 10,332.4. The S&P 500 sank 1.3% to end below the key 1,100 point level. The Nasdaq composite lost 36 points, or 1.6%, to close at 2,156.82.

Housing Starts Fall. Single Family Building Permits On Hold -  The Commerce Department released October New Residential Construction: Building Permits, Housing Starts, and Housing Completions data this morning.

Today's data was a big surprise to most market participants as economists were expecting housing starts to increase to 600,000 and permits to increase to a 580,000 annual rate.

Housing Starts data estimates how much new residential real estate construction occurred in the previous month. In last month's data, which reported on construction in September, new housing starts rose less than expected to 590,000 annualized units from a revised lower 587,000 pace in August, economists were expecting a rise of 610,000 units.

Stocks hit a roadblock - (CNNMoney.com) -- Stocks closed slightly lower Wednesday, paring deeper losses, after a drop in new home construction made investors jittery about the economic recovery and wary profit outlooks weighed on the technology sector.

The Dow Jones industrial average was down 11 points, or 0.1%, to close at 10,426.3. The S&P 500 fell less than one point to 1,109.8. The tech-heavy Nasdaq composite fell 10 points, or 0.5%, to 2,193.1.

Meanwhile, the dollar fell broadly against rival currencies, with the euro climbing near $1.50 at one point.

The weak dollar helped push gold prices to another all-time high, while oil prices closed above $79 a barrel.

Refinance Applications Down 1.4%. Purchase Index at 12 Year Low - In this week's release, which reports on loan application activity for the week ending November 13, 2009, new loan application fell 2.5%, even as the 30 year fixed-rate mortgage fell 0.7% to 4.83. The refinance index decreased 1.4% and the purchase index fell 4.7%. This is the sixth consecutive decline for the purchase index and is the lowest read since November 1997.

Stocks at 13-month highs after modest gains - (CNNMoney.com) Stocks recovered from early losses Tuesday, closing at 13-month highs for the second day in a row, as strength in commodity-linked shares offset weakness in the retail sector.

The Dow Jones industrial average rose about 30 points, or 0.3%, to close at 10,437.42. The S&P 500 gained 1 point to close above the key 1,100 level. The Nasdaq composite advanced 0.3% to end at 2,203.78.

All three indexes are at their highest levels since October 2008.

TransUnion: Mortgage Delinquencies Still On Rise, But at Slower Pace - National credit agency TransUnion reported today that, while mortgage delinquency rates continue to rise and have reached record levels, the rate of increase has now declined in each of the last three quarters.

This information is contained in a report released today by TransUnion.com analyzing trends in the mortgage industry and the impact of those trends on the consumer.

The national rate for delinquencies of 60 days or more hit an all time high of 6.25 percent during the third quarter. This was an increase of 7.57 percent over the 5.81 percent national rate during the second quarter. This is the 11th consecutive quarter that the delinquency rate nationwide has increased.

Home Builders Expecting Increased Activity in 2010 - The November Housing Market Index was unchanged from October's downwardly revised level of 17. The component gauging current sales conditions and the component gauging traffic of prospective buyers also remained unchanged, at 17 and 13, respectively. The component gauging sales expectations for the next six months did however improve, moving up two points, to 28.

S&P 500 Shoots Above 1,100 - (CNNMoney.com) -- Stocks rallied to 13-month highs Monday as investors focused on the weak U.S. dollar and Federal Reserve chairman Ben Bernanke said interest rates will remain low as the economy slowly recovers.

The Dow Jones industrial average rose 136 points, or 1.3%, to close at 10,406.96. That's the highest level for the blue-chip indicator since October 2008.

The S&P 500 gained 15.8 points, or 1.8%, to close above the psychologically important 1,100 level.

The Nasdaq composite rose 30 points, or 1.4%, to 2,197.5.

The Week Ahead: Data Storm Rains on Markets - A storm of data hit markets on Monday with retail sales an hour before the opening bell, plus the first look at November manufacturing and business inventories. To top off the day, Fed chairman Ben Bernanke gave a talk during the lunch hour a little after dual Treasury auctions. Fed chairman said high unemployment and tight credit will limit economic growth, but he dismissed worries about another recession and dollar weakness.

Later in the week markets will be looking at inflation indexes, housing construction data, the usual weekly labor report, and leading indicators.