The National Debt is currently: $17,565,412,702,957.00 is higher by about 20 BILLION. I post this so we will be aware of what we are leaving the next generation.
The Dow last traded at 16,501 about 250 pts. higher than where it was last Friday. The S&P 500 is trading at 1,872. Gold is trading at $1,303 an ounce, while oil futures at $101.38 a barrel. Gas prices, (Regular in El Dorado Hills, Costco, AM/PM), are at $3.75/Gal.
Mortgage Backed Securities or “MBS” yields are interest rates at which banks sell their loans into Fannie Mae and Freddie Mac bond programs. The FNMA 30-year fixed 4.0% coupon, containing 4.25% – 4.625% mortgages, pretty much the benchmark or how rate sheets are priced these days is currently trading at 104.15 about .15 better than where we were last Friday at this time. Basically each percent change in the price of the security translates to the price (or points paid or credited) of the mortgage rate. The higher the number (price), the better the rate.
In economic news this week; The reader’s digest version is the economy continues to limp along at a snail’s pace with The employment report being the big news of the week. The U.S. created 192,000 jobs in March, and the unemployment rate was unchanged at 6.7%.
Purchasing Managers’ Indexes (PMI) are economic indicators derived from monthly surveys of private sector companies. The two principal producers of PMIs are Markit Group, which conducts PMIs for over 30 countries worldwide, and the Institute for Supply Management (ISM), which conducts PMIs for the US. The surveys are done monthly by polling businesses that represent the makeup of the respective sector. The surveys cover private sector companies, but not the public sector. We watch these for an indication of future economic outlook. Results over 50 indicate an expansion from the prior month.
The Chicago purchasing-managers index fell to 55.9 in March hitting the lowest level since August, down 3.9 points from February led by drops for new orders and employment. The Chicago-PMI survey registers manufacturing and non-manufacturing activity in the Chicago region. Investors care about this indicator because the Chicago region somewhat mirrors the nation in its distribution of manufacturing and non-manufacturing activity.
The final Markit PMI for the U.S. in March was unchanged at 55.5, down from 57.1 in February. The slight drop-off in the March PMI comes after the Markit index rose in February to the highest level in almost four years, helped by manufacturers catching up after winter-related softness in January.
The Institute for Supply Management said its manufacturing index rose to 53.7% from 53.2% in February. The employment gauge dropped 1.2 points to 51.1%, but the ISM’s new-orders index edged up to 55.1% from 54.5%, and production surged to 55.9% from 48.2%, marking the best performance in 2014. Fourteen of the industries tracked by ISM reported growth last month while four recorded a decline.
The U.S. Commerce Department reported that orders for goods produced in U.S. factories rose 1.6 % in February. Factory orders fell by a revised 1% in January, compared with a prior estimate of a 0.7% decline. Orders for durable goods (products meant to last at least three years) rose 2.2% in February. Orders for nondurable goods increased 1%.
On the Real Estate front: There was no real estate related news released this week.
On the Employment front: The U.S. created 192,000 jobs in March, and the unemployment rate was unchanged at 6.7%, the result of more than a half-million people joining the labor force in search of work, according to Labor Department figures . The expectation was for an increase of 200,000 nonfarm jobs. In March, hiring was strongest in the professional ranks and at bars and restaurants. Manufacturing shed 1,000 jobs but was the only sector to do so.
Average hourly wages, meanwhile, dipped just 1 cent to $24.30 after several strong gains. And the average workweek jumped 0.2 hours to 34.5 hours, matching a post-recession high. The labor-force participation rate moved up to 63.2% from 63%, as 503,000 people searched for work, a sign that they think more jobs are available. Employment gains for February and January were revised higher by a combined 37,000. The number of new jobs created in February was raised to 197,000 from 175,000, while January’s figure was increased to 144,000 from 129,000.
The gain in employment might not be large enough to assure that job creation and broader economic growth are ready to reignite after a first-quarter slowdown. The main takeaway from this report is that employment growth and upward revisions along with a rebound in the workweek are good news, not great news, but good news. The flat growth in hourly earnings and the lack of a drop in the unemployment rate reminds us that the Fed has plenty of breathing room, for now.
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