Morning Report: Job openings fall

Vital Statistics:

	Last	Change
S&P Futures	2141.0	11.0
Eurostoxx Index	335.9	3.2
Oil (WTI)	46.0	1.4
US dollar index	86.9	0.1
10 Year Govt Bond Yield	1.48%
Current Coupon Fannie Mae TBA	103.3
Current Coupon Ginnie Mae TBA	104.2
BankRate 30 Year Fixed Rate Mortgage	3.57

Stocks are higher this morning as global markets continue to recover in anticipation of further government stimulus. European bank shares, which led the markets down, are rebounding. Bonds and MBS are down

Job openings fell to 5.5 million from 5.8 million in May. This is the lowest since February, and shows that some of the strength in the labor market is dissipating. Note that the JOLTS data has been much stronger than the other labor market indicators - it was at a record not too long ago. 

The NFIB Small Business Optimism ticked up .7 points in June. Small business owners appear to be on the same track they have followed for the past few years – maintenance mode, but not much growth. This will keep the economy moving forward, but not at an impressive pace. While sentiment has been improving, it remains well below the average of 98 since the mid-80s,

Mortgage credit availability decreased in June, according to the MBA's Mortgage Credit Availability Index. Conventional loans had the biggest tightening, while government loans only tightened slightly. A number of investors discontinued conventional high balance 7-year ARMs, while keeping their 5 and 10 year ARMs intact. A note about the chart below. It begins in early 2012 at 100, which more or less marks the bottom of the real estate bust. If you use the same methodology to project what the index would have been previously, it would have peaked at about 900 in 2006, compared to 120, where it is today. 

Completed Foreclosures fell 7% year-over-year to 38,000 according to CoreLogic. The national foreclosures inventory fell 25% to 390k homes, or about 1% of all homes with a mortgage. This takes us back to October 2007 levels, which is still about 2x the historical average. The seriously delinquent rate continued to fall and is now down to 2.8%. 

The House approved a bill changing the structure of the CFPB, by subjecting it to Congressional appropriation like every other governmental agency, and replacing the single director with a bipartisan committee. It also requires the CFPB to conduct a cost-benefits analysis for any proposed changes to arbitration regulations. 

Lot sizes for new homes are the smallest on record, according to the NAHB, down to 8,600 square feet. 20 years ago, the median lot size was about 10,000 square feet. Interestingly, the average square footage of new homes has increased by 150 since the real estate bust.