| Last | Change | Percent | |
| S&P Futures | 1637.0 | -2.1 | -0.13% |
| Eurostoxx Index | 2727.4 | -25.9 | -0.94% |
| Oil (WTI) | 107.8 | -0.8 | -0.73% |
| LIBOR | 0.259 | -0.001 | -0.19% |
| US Dollar Index (DXY) | 82.29 | -0.073 | -0.09% |
| 10 Year Govt Bond Yield | 2.86% | 0.00% | |
| Current Coupon Ginnie Mae TBA | 103.6 | 0.0 | |
| Current Coupon Fannie Mae TBA | 102.8 | 0.1 | |
| RPX Composite Real Estate Index | 200.7 | -0.2 | |
| BankRate 30 Year Fixed Rate Mortgage | 4.54 |
Should be a slow day with not much economic data and the Jewish holiday. Mortgage applications rose 1.3% last week. bonds and MBS are flat
Construction spending rose .6% last month and is up 5.2% year over year. Residential construction is up .6% month over month and 17.2% year-over-year. We are definitely seeing signs of life in the homebuilding sector, although the first time homebuyer is getting a bit of sticker shock from the higher rates. Pulte noted on their 2Q conference call that buyers at the lower price points (read the first time homebuyer) are backing away a bit. Toll Brothers (which is in the McMansion business) reported that the luxury homebuyer is unfazed by higher rates.
CoreLogic reported that home prices increased 12.4% year over year and and now within 18% of their April 2006 peak. Every state reported a year-over-year increase in prices if you exclude distressed sales. While they predict that August's increase will be similar to July's, they anticipate the appreciation to stall as seasonal demand wanes and people start to feel the effects of higher rates. As usual, the hardest hit states are reporting the strongest recoveries.
Yesterday's ISM report showed strength in manufacturing. While manufacturing isn't the driver of the economy that it used to be, it still matters quite a lot. The reading of 55.7 corresponds to a GDP growth rate of over 4%. Unfortunately, while manufacturing output is up quite a bit, manufacturing employment is not. Auto sales are up around the 16MM range, which is approaching pre-crisis levels. The average US car is around 11 years old, so we are due for a upgrade cycle. That will be bullish for the economy.
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