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Economic Highlights for the Week Ending December 7, 2012
Posted 12-07-2012 at 07:28 PM by CRESTICO
MONDAY, December 3rd
Construction spending rose sharply in October, gaining 1.4% led by a nice 3.0% gain in the residential sector. Non-residential construction rose 0.3% as public construction expenditures increased 0.8%. Total construction spending is now 9.6% above its year ago level. In the private sector, both the residential and nonresidential components continue to climb irregularly higher while public sector spending is trending lower. Gains in the private sector are expected to continue going forward even though rising from a very deep bottom.
The ISM manufacturing index fell to 49.5% in November from a reading of 51.7% in October. Market expectations were for a very modest decline; one-time effects from Hurricane Sandy may be at cause for the much weaker than expected reading. The current level of the index below the key 50% level indicates a downshift in manufacturing activity during the month as well as slowing in the broader economy.
TUESDAY, December 4th
Motor vehicle sales surged 8.7% in November to an annual rate of 15.5 million units. This was the highest level of vehicle sales since December 2007. Sales of autos rose 8.0% to an annual rate of 8.0 million while light truck sales increased 9.4% to a 7.5 million annual pace. Total vehicle sales are now 14.7% above their year ago level. These data suggest that both retail sales and consumer spending for the month will be on a solid track.
WEDNESDAY, December 5th
The MBA mortgage applications index rose 4.5% to 877.0% for the week ending November 30. The gain was led by a 6.1% rise in the refinance index; the purchase index edged 0.1% higher on the week. Falling mortgage rates continue to support refinancing activity. Contract mortgage rates slipped again last week with the 30-year fixed down 1bps to 3.52%.
The ISM-non-manufacturing survey which tracks service sector activity, increased to 54.7% in November from 54.2% in October. The level of the index shows that business activity in the services, construction and government sectors of the economy accelerated slightly in November however growth in these sectors remains moderate. Continued growth in new orders and export orders indicates continued modest growth in the service sectors of the economy in the months ahead.
THURSDAY, December 6th
Jobless claims sank 25k to 370k for the week ending December 1. Is appears that the effects of Hurricane Sandy have been washed out of the data with claims returning to their pre-storm range. Initial claims have been quite volatile this year but have maintained a little changed weekly average of 376k. The current level of claims and the weekly average level of claims this year indicate slow but ongoing improvement in labor market conditions.
FRIDAY, December 7th
Payroll employment increased 146k in November exceeding market expectations for a gain of 86k. However, downward revisions in the prior two months resulted in 49k fewer jobs on net. Job growth last month almost exclusively occurred in the private sector. Government jobs fell by 1k. Employment is up 1.43% over the past year but remains 4.099 million below its January 2008 peak level. Job creation in November seemingly was unaffected by Hurricane Sandy. Job creation has averaged 157k a month for the past twelve months compared to a monthly average of 153k a month in 2011. The job growth trend is very low and slow and not sufficient enough to drive more robust economic growth. But job growth is positive and steady. Separately, the unemployment rate dropped to 7.7% in November from 7.9% in October due to a decline in the labor force.
Stock Market Close for the Week
Index Latest A Week Ago Change
DJIA 13155.13 13025.58 +129.55 or +0.99%
NASDAQ 2978.04 3010.24 -32.20 or 1.07%
WEEK IN ADVANCE
The headliner on the economic calendar in the coming week is November retail sales report. Retail sales will actually provide a progress report on the strength of consumer spending thus far in the holiday shopping season. Tracking consumer spending is important because it accounts for two-thirds of all economic activity making it a primary growth driver. Also featured next week is a two-day FOMC meeting where policy makers will decide what to do with a Treasury bond purchase program which is set to expire at the end of this year.
To read our daily market report updates please visit [URL="http://www.crestico.com"]Los Angeles Real Estate Mortgage[/URL]
Construction spending rose sharply in October, gaining 1.4% led by a nice 3.0% gain in the residential sector. Non-residential construction rose 0.3% as public construction expenditures increased 0.8%. Total construction spending is now 9.6% above its year ago level. In the private sector, both the residential and nonresidential components continue to climb irregularly higher while public sector spending is trending lower. Gains in the private sector are expected to continue going forward even though rising from a very deep bottom.
The ISM manufacturing index fell to 49.5% in November from a reading of 51.7% in October. Market expectations were for a very modest decline; one-time effects from Hurricane Sandy may be at cause for the much weaker than expected reading. The current level of the index below the key 50% level indicates a downshift in manufacturing activity during the month as well as slowing in the broader economy.
TUESDAY, December 4th
Motor vehicle sales surged 8.7% in November to an annual rate of 15.5 million units. This was the highest level of vehicle sales since December 2007. Sales of autos rose 8.0% to an annual rate of 8.0 million while light truck sales increased 9.4% to a 7.5 million annual pace. Total vehicle sales are now 14.7% above their year ago level. These data suggest that both retail sales and consumer spending for the month will be on a solid track.
WEDNESDAY, December 5th
The MBA mortgage applications index rose 4.5% to 877.0% for the week ending November 30. The gain was led by a 6.1% rise in the refinance index; the purchase index edged 0.1% higher on the week. Falling mortgage rates continue to support refinancing activity. Contract mortgage rates slipped again last week with the 30-year fixed down 1bps to 3.52%.
The ISM-non-manufacturing survey which tracks service sector activity, increased to 54.7% in November from 54.2% in October. The level of the index shows that business activity in the services, construction and government sectors of the economy accelerated slightly in November however growth in these sectors remains moderate. Continued growth in new orders and export orders indicates continued modest growth in the service sectors of the economy in the months ahead.
THURSDAY, December 6th
Jobless claims sank 25k to 370k for the week ending December 1. Is appears that the effects of Hurricane Sandy have been washed out of the data with claims returning to their pre-storm range. Initial claims have been quite volatile this year but have maintained a little changed weekly average of 376k. The current level of claims and the weekly average level of claims this year indicate slow but ongoing improvement in labor market conditions.
FRIDAY, December 7th
Payroll employment increased 146k in November exceeding market expectations for a gain of 86k. However, downward revisions in the prior two months resulted in 49k fewer jobs on net. Job growth last month almost exclusively occurred in the private sector. Government jobs fell by 1k. Employment is up 1.43% over the past year but remains 4.099 million below its January 2008 peak level. Job creation in November seemingly was unaffected by Hurricane Sandy. Job creation has averaged 157k a month for the past twelve months compared to a monthly average of 153k a month in 2011. The job growth trend is very low and slow and not sufficient enough to drive more robust economic growth. But job growth is positive and steady. Separately, the unemployment rate dropped to 7.7% in November from 7.9% in October due to a decline in the labor force.
Stock Market Close for the Week
Index Latest A Week Ago Change
DJIA 13155.13 13025.58 +129.55 or +0.99%
NASDAQ 2978.04 3010.24 -32.20 or 1.07%
WEEK IN ADVANCE
The headliner on the economic calendar in the coming week is November retail sales report. Retail sales will actually provide a progress report on the strength of consumer spending thus far in the holiday shopping season. Tracking consumer spending is important because it accounts for two-thirds of all economic activity making it a primary growth driver. Also featured next week is a two-day FOMC meeting where policy makers will decide what to do with a Treasury bond purchase program which is set to expire at the end of this year.
To read our daily market report updates please visit [URL="http://www.crestico.com"]Los Angeles Real Estate Mortgage[/URL]
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