While everyone was preparing for New Year’s Eve, investors were patiently waiting to celebrate the Dow reaching 20,000. It seemed to be a probable goal by Christmas, but, the last week of the year kept investors waiting to release the balloons and pop the bubbly. The Dow cruised to a high of 19,974 on December 20 and then stalled. On Wednesday, the Dow dropped more than 100 points to close at 19,840. The downward trend continued throughout the week as the year closed out at 19,762.60.
Meanwhile, Consumer Confidence grew in December reaching 113.7 per the index, up from a revised 109.4 in November. This was the highest level since 2001. Experts attribute this rise to an improving U.S. economy and anticipation of a Trump presidency.
While Trump’s victory may have been positive for stocks and business, it has hurt Pending Home Sales. Before the election, mortgage rates were around 3.6 percent. Since the election, rates have surged to 4.4 percent. With rates moving almost a point, that is adding, roughly an extra $100 a month payment to a $200,000 mortgage. Combined with a shortage of inventory, the jump in interest rates have led to Pending Home Sales dropping 2.5 percent in November. However, with steady growth in the economy and positive job market prospects, many families have the renewed confidence to buy a house. In addition, home prices continue to rise. The S&P Case-Shiller Index rose .6 percent in October and is 5.1 percent higher for the year. Cities in the west, such as Seattle, led the increase while New York showed the biggest decline, down .2 percent from the previous month and only 1.7 percent higher for the year. Builders have increased production to meet the rising demand for housing which could in turn slow down rising prices.
The U.S. Trade Gap increased 5.5 percent in November, according to the Commerce Department. This was a higher increase than anticipated and the highest reading since 2008. Exports were up 1 percent while Imports were up 1.2 percent. In addition, Wholesale Inventories increased slightly, .9 percent, in November.
Jobless Claims fell 10,000 last week as many Americans move in and out of the workforce throughout the holiday season. The four-week average of initial claims was down slightly, 750 less applicants. However, Continuing Jobless Claims rose by 63,000 to 2.1 million for the week ending December 17.
To wrap up the light news week, Chicago PMI fell 3 points in December to 54.6. The Chicago PMI is a measure of Midwest economic activity. New orders, one of the components of the index, fell 6.7 percent to 56.5. A majority of business owners expect the Trump administration to be favorable for their business.
Looking forward to the New Year and the following reports being released:
Tuesday: ISM and Construction Spending
Wednesday: Motor Vehicle Sales
Thursday: Weekly Jobless Claims and ISM Non-manufacturing
Friday: NonFarm Payrolls, Unemployment Rate, Average Hourly Earnings, Foreign Trade Balance, and Factory Orders
Thank you for your business and many wishes for a happy and very prosperous new year!
Meanwhile, Consumer Confidence grew in December reaching 113.7 per the index, up from a revised 109.4 in November. This was the highest level since 2001. Experts attribute this rise to an improving U.S. economy and anticipation of a Trump presidency.
While Trump’s victory may have been positive for stocks and business, it has hurt Pending Home Sales. Before the election, mortgage rates were around 3.6 percent. Since the election, rates have surged to 4.4 percent. With rates moving almost a point, that is adding, roughly an extra $100 a month payment to a $200,000 mortgage. Combined with a shortage of inventory, the jump in interest rates have led to Pending Home Sales dropping 2.5 percent in November. However, with steady growth in the economy and positive job market prospects, many families have the renewed confidence to buy a house. In addition, home prices continue to rise. The S&P Case-Shiller Index rose .6 percent in October and is 5.1 percent higher for the year. Cities in the west, such as Seattle, led the increase while New York showed the biggest decline, down .2 percent from the previous month and only 1.7 percent higher for the year. Builders have increased production to meet the rising demand for housing which could in turn slow down rising prices.
The U.S. Trade Gap increased 5.5 percent in November, according to the Commerce Department. This was a higher increase than anticipated and the highest reading since 2008. Exports were up 1 percent while Imports were up 1.2 percent. In addition, Wholesale Inventories increased slightly, .9 percent, in November.
Jobless Claims fell 10,000 last week as many Americans move in and out of the workforce throughout the holiday season. The four-week average of initial claims was down slightly, 750 less applicants. However, Continuing Jobless Claims rose by 63,000 to 2.1 million for the week ending December 17.
To wrap up the light news week, Chicago PMI fell 3 points in December to 54.6. The Chicago PMI is a measure of Midwest economic activity. New orders, one of the components of the index, fell 6.7 percent to 56.5. A majority of business owners expect the Trump administration to be favorable for their business.
Looking forward to the New Year and the following reports being released:
Tuesday: ISM and Construction Spending
Wednesday: Motor Vehicle Sales
Thursday: Weekly Jobless Claims and ISM Non-manufacturing
Friday: NonFarm Payrolls, Unemployment Rate, Average Hourly Earnings, Foreign Trade Balance, and Factory Orders
Thank you for your business and many wishes for a happy and very prosperous new year!
