May 15, 2009
May 15, 2009 by admin
Consumer confidence perked up in the month of April, a welcome report to a struggling economy. The upbeat news on consumer confidence helped to move the stock market higher in early trading on Friday as investors are looking to secure long term equity positions in hope of an economic rebound in the next twelve months. The market has now moved up over thirty percent from the March 9 lows and is beginning to stabalize into a more traditional pattern of trading and volume.
The PPI & CPI reports over the past two days have shown a slight uptick with inflation, which is also a good sign for improved economic times. CPI core inflation for the month of April was up slightly for the month, numbers which exclude energy prices that have also begun to move back up. The CPI report indicated wage growth has been relatively flat and the largest increase in core prices was with tobacco related products. Another major report released today was the manufacturing index report that is indicating manufacturing levels are still down, but orders are now at their highest levels since last August.
The news of the day is not all that great for the auto industry, yesterday Daimler-Chrysler announced they would be closing around 700 of their dealerships and today GM is expected to announce they would be closing over 1000 of their dealers nationally. The two auto companies which have been dominant figures in the news continue to lose market share as they struggle to adjust their business models. The large dealership closures are certain to add to the upcoming unemployment figures and will have a large impact on the economic lives of thousands of Americans.
Mortgage rates are flat today, following a slight pull back this week. The yield on the ten year bond opened at 3.15% on Friday. Fixed rate thirty year home loans have move back closer to the five percent range this week. The market continues to struggle with home foreclosures and banks are having a tough time handling the volume of customers who would like to pursue loan modifications or refinance with government backed programs. This has prompted more action from the Federal Government which announced on Thursday additional incentives to help lenders streamline the loan modification process and help home owners lock into lower rates and house payments. This move is certain to gain momentum if property foreclosures continue to escalate in the near future.