Stock markets suffer the worst weekly loss this year - Stock markets officially entered correction territory and the NASDAQ is now in a bear market. It’s down 20% from its peak. Fears of higher interest rates after The Fed raised rates for the fourth time this year, increased trade tensions with China, slowing economic conditions in Europe and Asia, falling oil prices, fears of a government shutdown, and political tensions had investors running for cover. The Dow Jones Industrial Average closed the weekat 22,445.37, down from 24,100.51 last week. It was down 6.9% for the week and is now down 9.2% year to date. The S&P 500 closed the week at 2,416.62, down from 2,599.95 last week. It was down 7.1% for the week and is down 9.6% year to date. The NASDAQ closed the week at 6,332.99, down from 6,910.77 last week. It was down 8.4% for the week and down 8.3% year to date.
Treasury Bond Yields dropped this week as investors moved money from stocks to treasury bonds - The 10-year treasury bond closed the week yielding 2.79%, down from 2.89% last week. The 30-year treasury bond yield ended the week at 3.03%, down from 3.14% last week. We watch treasury bond yields because mortgage rates follow bond yields.
Mortgage rates remain at the lowest level in three months - The December 20, 2018 Freddie Mac Primary Mortgage Survey reported that the 30-year fixed mortgage rate average was 4.62%, unchanged from 4.63% last week. The 15-year fixed was 4.07%, unchanged from 4.07% last week. The 5-year ARM was 3.98%, down from 4.04% last week. Rates ended the week slightly lower.
California housing market continues to struggle in November - The California Association of Realtors reported that existing single-family home sales totaled 381,400 on a seasonally adjusted annualized rate in November. Year over year the number of homes sold was down 13.4% from last November. The statewide median price was $544,000, down 3% from October and up 1.5% from November 2017. The unsold inventory index was 3.7 months, up from 2.9 months last November.