EconCurrents

Summary Of the Markets Today:

• The Dow closed up 3 points or 0.01%,
• Nasdaq closed down 0.59%,
• S&P 500 closed down 0.16%,
• Gold $1747 up $6.80,
• WTI crude oil settled at $78 up $1.19,
• 10-year U.S. Treasury 3.757% uo 0.057%,
• USD index $106.85 up $0.17,
• Bitcoin $16,479 up $273.00

Today’s Economic Releases:

The S&P CoreLogic Case-Shiller 20-City Composite posted a 10.4% year-over-year gain, down from 13.1% in the previous month. CoreLogic Deputy Chief Economist Selma Hepp said:

In September, the CoreLogic S&P Case-Shiller Index gains continued to quickly approach single digits, posting a 10.6% year-over-year increase — marking the sixth straight month of decelerating annual home price growth and the slowest since December 2020. Compared to the 2022 spring peak, home prices are down 3% nationally, with over 10% declines in San Francisco and Seattle. Historically, home prices have increased by about 1% from spring to September. Housing markets continue to face a loss of consumer confidence and the ongoing standoff between buyers and sellers. Potential buyers are held back by the rapidly rising cost of homeownership and fears of price declines. At the same time, potential sellers continue to contend with the lock-in effect of notably lower mortgage rates than the current market rates, which financially disincentivizes them from moving. For the remainder of the year, housing market activity will continue to be depressed, both due to seasonality and fall’s vast surge in mortgage rates, which will keep the home price growth rate moving closer to low single digits.

The Conference Board Consumer Confidence Index decreased in November after also losing ground in October. Said Lynn Franco, Senior Director of Economic Indicators at The Conference Board:

Consumer confidence declined again in November, most likely prompted by the recent rise in gas prices. The Present Situation Index moderated further and continues to suggest the economy has lost momentum as the year winds down. Consumers’ expectations regarding the short-term outlook remained gloomy. Inflation expectations increased to their highest level since July, with both gas and food prices as the main culprits. Intentions to purchase homes, automobiles, and big-ticket appliances all cooled. The combination of inflation and interest rate hikes will continue to pose challenges to confidence and economic growth into early 2023.

A summary of headlines we are reading today:

Summary Of the Markets Today:

• The Dow closed down 498 points or 1.45%,
• Nasdaq closed down 1.58%,
• S&P 500 closed down 1.54%,
• Gold $1755 down $14.80,
• WTI crude oil settled at $76 up $0.58,
• 10-year U.S. Treasury 3.687% down 0.015%,
• USD index $106.70 up $0.74,
• Bitcoin $16,240 down $179.40

Today’s Economic Releases:

Once-a-year All-Access Pass: Save $3,011 on Elliott Wave International’s highest-quality, Elliott wave trading e-courses. Trading doesn’t mean buy and hold, it means punching in both directions. EWI can show you how. Explore course titles now.

The Dallas Fed’s Texas Manufacturing Index abated in November 2022 as it fell five points to near zero, suggesting little change in output from October.

A summary of headlines we are reading today:

Summary Of the Markets Today:

• The Dow closed up 153 points or 0.45%,
• Nasdaq closed down 0.52%,
• S&P 500 closed down 0.03%,
• Gold $1755 up $9.40,
• WTI crude oil settled at $77 down $1.39,
• 10-year U.S. Treasury 3.689% down 0.02%,
• USD index $106.02 up $0.20,
• Bitcoin $16,524 down $61.50,
• Baker Hughes Rig Count: U.S. +2 to 784 rigs

Today’s Economic Releases:

Once-a-year All-Access Pass: Save $3,011 on Elliott Wave International’s highest-quality, Elliott wave trading e-courses. Trading doesn’t mean buy and hold, it means punching in both directions. EWI can show you how. Explore course titles now.

A summary of headlines we are reading today:

Summary Of the Markets Today:

• The Dow closed up 97 points or 0.3%,
• Nasdaq closed up 0.99%,
• S&P 500 up 0.59%,
• Gold $1752 up $11.90,
• WTI crude oil settled at $77 down $3.48,
• 10-year U.S. Treasury 3.696% down 0.062%,
• USD index $106.11 down $1.11,
• Bitcoin $16,542 up $342.90

Today’s Economic Releases:

In the week ending November 19, the advance figure for Unemployment Insurance Weekly Claims 4-week moving average was 226,750, an increase of 5,500 from the previous week’s revised average. The previous week’s average was revised up by 250 from 221,000 to 221,250. The current increases are likely a result of layoffs in the tech industry.

New orders for manufactured durable goods in October 2022 slowed somewhat to 10.7% year-over-year (blue line on graph below). However, inflation adjusted durable goods improved to 3.8% year-over-year as inflation is moderating in the durable goods sector (red line on graph below). The durable goods sector has been improving since March 2022.

The CoreLogic Loan Performance Insights report shows that in August 2021, 4% of mortgages were delinquent by at least 30 days or more including those in foreclosure. This represents a 2.6-percentage point decrease in the overall delinquency rate compared with August 2020.

Sales of new single‐family houses in October 2022 is 5.8% below October 2021. Sales Price The median sales price of new houses sold in October 2022 was $493,000.  The average sales price was $544,000.

The Federal Reserve’s FOMC released the minutes for their meeting which ended on November 2, 2022. Highlights:

… participants observed that al­though real GDP rebounded in the third quarter, recent data suggested that economic activity in the near term appeared likely to expand at a pace below its trend growth rate. Participants noted a softening in consumer and business spending growth, and some participants remarked that there had been a notable slowing in interest rate-sensitive sectors, particularly housing, in response to the tightening of financial conditions associated with the Committee’s policy actions. With inflation remaining far too high and showing few signs of moderating, participants observed that a period of below-trend real GDP growth would be helpful in bringing aggregate supply and aggregate demand into better balance, reducing inflationary pressures, and setting the stage for the sustained achievement of the Committee’s objectives of maximum employment and price stability.

… Participants agreed that inflation was unacceptably high and was well above the Committee’s longer-run goal of 2 percent. Some participants noted that the burden of high inflation was falling disproportionally on low-income households, for whom necessities like food, energy, and shelter make up a larger share of expenditures. Many participants observed that price pressures had increased in the services sector and that, historically, price pressures in this sector had been more persistent than those in the goods sector. Some participants noted that the recent high pace of nominal wage growth, taken together with the recent low pace of productivity growth, would, if sustained, be inconsistent with achievement of the 2 percent inflation objective. Several participants, however, commented on signs of a moderation in nominal wage growth. Participants agreed that near-term inflation pressures were high, but some noted that lower commodity prices or the expected reduced pressure on goods prices due to an easing of supply constraints should contribute to lower inflation in the medium term. 

… Participants discussed the length of the lags in the response of the economy to monetary policy actions, taking into account historical experience and the various estimates of timing relationships provided in economic research, as well as the high degree of uncertainty involved in applying the evidence on lags to the current situation. They noted that monetary policy tightening typically produced rapid effects on financial conditions but that the full effects of changes in financial conditions on aggregate spending and the labor market, and then on inflation, likely took longer to materialize. With regard to current circumstances, many participants remarked that, even though the tightening of monetary policy had clearly influenced financial conditions and had had notable effects in some interest rate-sensitive sectors, the timing of the effects on overall economic activity, the labor market, and inflation was still quite uncertain, with the full extent of the effects yet to be realized. Several participants observed that, because of the difficulties in isolating the effects of monetary policy, changes in economic structure, or increasing transparency over time regarding monetary policy decisions, the historical record did not provide definitive evidence on the length of these lags. In addition, some participants noted that the post-pandemic dynamics of the economy may differ from those prevailing prior to the pandemic.

…  various participants noted that, with inflation showing little sign thus far of abating, and with supply and demand imbalances in the economy persisting, their assessment of the ultimate level of the federal funds rate that would be necessary to achieve the Committee’s goals was somewhat higher than they had previously expected.

… a substantial majority of participants judged that a slowing in the pace of increase would likely soon be appropriate. A slower pace in these circumstances would better allow the Committee to assess progress toward its goals of maximum employment and price stability. 

A summary of headlines we are reading today:

Summary Of the Markets Today:

• The Dow closed up 398 points or 1.18%,
• Nasdaq closed up 1.36%,
• S&P 500 up 1.36%,
• WTI crude oil settled at $81 up $1.08,
• USD $107.71 down $0.66,
• Gold $1740 up $1.30,
• Bitcoin $16.117 up 1.95% – Session Low 15,536,
• 10-year U.S. Treasury 3.767% down 0.06%

*Stock data, cryptocurrency, and commodity prices at the market closing.

Today’s Economic Releases:

The Richmond Fed manufacturing survey improved from -10 last month to -9 in November 2022 – which means the survey remained in negative territory which indicates contraction and weak manufacturing conditions.

Here is a summary of headlines we are reading today: