MORE HOMES MOVED IN MAY
In a pleasant surprise for economists, both new and existing home sales picked up last month. The National Association of Realtors announced a 1.1% gain for resales, with the average house for sale spending only 27 days on the market. New home buying increased 2.9% in May, resulting in an annualized gain of 8.9%. The average sale price for a new home was $406,400, a record.1
LEADING INDICATORS IMPROVE
The Conference Board’s Leading Economic Index rose 0.3% for May, following gains of 0.2% for April and 0.4% for March. Most of the index’s components were positive for May and a steepening interest rate spread, a climb for the Institute for Supply Management’s new orders index, and greater consumer optimism about business and economic conditions were major factors. The LEI was up 3.5% year-over-year through May.2
CRUDE IS ON ITS LONGEST LOSING STREAK IN 2 YEARS
WTI crude settled at $43.01 at Friday’s closing bell, down 4.4% from the end of last week. This decline marked the fifth straight weekly retreat for oil; an 8-week losing streak ended in August 2015. Oil is now in a bear market.3
All three of the major U.S. equity indices had made 5-day gains by the time trading wrapped up on Friday. The Dow Jones Industrial Average had added just 0.05%, advancing to 21,394.76, and the S&P 500 had improved 0.21% to 2,438.30. In contrast, the Nasdaq Composite rose 1.84% to 6,265.25. Even after this last sideways week, the Dow 30 ended Friday’s session up 1.49% month-over-month.4
- On Monday, the Census Bureau shares data on May hard goods orders.
- Tuesday sees the release of the latest consumer confidence index from the Conference Board, plus earnings reports from Darden Restaurants and KB Home.
- Wednesday, the NAR puts out its May pending home sales report, and Franklin Covey, General Mills, Monsanto, Paychex, and Pier 1 announce earnings.
- The third estimate of Q1 GDP appears Thursday along with a new initial unemployment claims report and earnings announcements from ConAgra Brands, Constellation Brands, Micron Technology, Nike, and Walgreens Boots Alliance.
- The final June University of Michigan consumer sentiment index, May consumer spending figures, and the May PCE price index arrive on Friday.
|% CHANGE||Y-T-D||1-YR CHG||5-YR AVG||10-YR AVG|
|REAL YIELD||6/23 RATE||1 YR AGO||5 YRS AGO||10 YRS AGO|
|10 YR TIPS||0.45%||0.24%||-0.42%||2.70%|
Sources: wsj.com, bigcharts.com, treasury.gov – 6/23/174,5,6,7
Indices are unmanaged, do not incur fees or expenses, and cannot be invested into directly. These returns do not include dividends. 10-year TIPS real yield = projected return at maturity given expected inflation.
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1 – foxbusiness.com/features/2017/06/23/new-home-sales-rise-in-may-as-prices-hit-record-level-update.html [6/23/17]
2 – haver.com/comment/comment.html?c=170622d.html [6/22/17]
3 – marketwatch.com/story/oil-prices-edge-up-as-big-producers-stick-to-cuts-2017-06-23-6103497/ [6/23/17]
4 – markets.wsj.com/us [6/23/17]
5 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=6%2F23%2F16&x=0&y=0 [6/23/17]
5 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=6%2F23%2F16&x=0&y=0 [6/23/17]
5 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=6%2F23%2F16&x=0&y=0 [6/23/17]
5 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=6%2F22%2F12&x=0&y=0 [6/23/17]
5 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=6%2F22%2F12&x=0&y=0 [6/23/17]
5 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=6%2F22%2F12&x=0&y=0 [6/23/17]
5 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=6%2F22%2F07&x=0&y=0 [6/23/17]
5 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=6%2F22%2F07&x=0&y=0 [6/23/17]
5 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=6%2F22%2F07&x=0&y=0 [6/23/17]
6 – treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyield [6/23/17]
7 – treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyieldAll [6/23/17]