The stock market has been
trading in a narrow range all week. With
a lack of any real market moving data this week it seems that all eyes are on
today’s unemployment report being released at 8:30AM. What increased the focus on employment data
is that on Wednesday the Federal Open Market Committee released the minutes
from their last meeting. In the report
it is clear that the Fed is watching very closely the labor markets to
determine at what pace they will continue to taper the economic stimulus program.
As everyone knows by now the
Fed has reduced their bond buying program by 10 billion a month starting with
this month. There is no set time table
or schedule for future reductions as of right now and the employment reports,
both today and in the future, are expected to play a major factor in the Fed’s
monetary policy decisions in 2014.
Although the Fed and
investors place most of the focus on today’s national employment statistics
released by the department of labor, on Wednesday the ADP Employment Report was
released. ADP estimated 238,000 private
payroll jobs were created last month.
This was slightly higher than expectations. The stock market moved into positive
territory on Wednesday based on this news however response was tempered due to ADP’s
poor track record of employment predictions over the last year. Truth be told, ADP estimates have been more
in line with the national reports over the last few months however it seems
that investors have not yet gotten over the massive employment miscalculations
from ADP over the last few years. First
time jobless claims continue to remain in the 330k range.
(The expectation for the
Employment Report this morning is that the unemployment rate will remain at
7.0% and that the economy will add approximately 200,000 new jobs.)
The big question is what is Congress going to do about the 1.3
million people that lost unemployment benefits on December 28th? As is typical, both sides of Congress are
not in agreement on what to do and the American public is caught in the middle.
Mortgage rates for the most
part have been flat for the last 2 weeks.
Minor movement up and down has occurred but overall the rise in mortgage
rate towards the end of 2013 is playing a role in housing.
Applications for purchase applications
declined 1% in the prior week. According
to the Mortgage Bankers Association applications for purchase loans is down a
whopping 20% from the same time last year.
Applications for refinances tipped up last week by 5% but that is not
very significant since the total number of people refinancing at this point is
much lower than in months and years past.
JJ Mack
916-517-1800 x 300
jj.mack@apmortgage.com
www.apmcroseville.com
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