Stock markets - This week, good news for the economy was treated like bad news for investors. The third quarter Gross Domestic Product (GDP), the broadest measure of economic output, increased by 3.2% year-over-year from the third quarter of 2021. This week's jobless claims were also lower than expected. With the economy and job market still showing such strength, investors fear that the Federal Reserve will continue aggressively increasing interest rates to cool the economy and tame inflation. The Dow Jones Industrial Average closed the week at 33,203.93, up 0.9% from 32,920.46 last week. It is down 8.4% year-to-date. The S&P 500 closed the week at 3,844.82, down 0.2% from 3,852.36 last week. The S&P is down 19.3% year-to-date. The NASDAQ closed the week at 10,497.87, down 2% from 10,705.41 last week. It is down 32.9% year-to-date.
U.S. Treasury bond yields - The 10-year treasury bond closed the week yielding 3.75%, up from 3.48% last week. The 30-year treasury bond yield ended the week at 3.82%, up from 3.53% last week. We watch bond yields because mortgage rates often follow treasury bond yields.
Mortgage rates - The Freddie Mac Primary Mortgage Survey reported that mortgage rates for the most popular loan products as of December 22, 2022, were as follows: The 30-year fixed mortgage rate was 6.27%, down from 6.31% last week. The 15-year fixed was 5.69%, up from 5.54% last week.
U.S. existing-home sales - The National Association of Realtors reported that existing-home sales totaled 4.09 million units on a seasonally adjusted annualized rate in November, down 7.7% month-over-month from the annualized number of sales in October. Year-over-year sales were down 35.4% from an annualized rate of 6.33 million in November 2021. The median price for a home in the U.S. in November was $370,700, up 3.5% from $358,200 one year ago. November marked a record 129 consecutive year-over-year increases in the median price. There was a 3.3-month supply of homes for sale in November, up from a 2.1-month pool last November. First-time buyers accounted for 28% of all sales. Investors and second-home purchases accounted for 16% of all sales. All-cash purchases accounted for 26% of all sales. Foreclosure and short sales accounted for 2% of all sales.
Merry Christmas, Happy Hanukkah, and Happy Holidays!