Economic update for the week ending February 8, 2020
The number of new jobs added in January exceeds expectations - The Department of Labor Statisticsreported that U.S. employers added 225,000 new Jobs in January. That number eclipsed analysts’ expectations of 158,000 new jobs. The unemployment rate ticked up from 3.5% (a 50-year low) to 3.6%, as more employees entered the labor force. Wage growth rose with hourly wages 3.1% higher than last January.
Stock markets had the largest weekly gain in six months - Stocks rebounded from last week’s steep losses, the worst week since October, with their best week in six months. While last week investors sold off stocks because of fears that the Coronavirus would slow global growth, they ignored those fears this week and stocks rebounded. The Dow Jones Industrial Average closed the week at 29,108.51, up 3.0% from 28,256.03 last week. It’s up 2.0% year to date. The S&P 500 closed the week at 3,327.71, up 3.1% from 3,225.52 last week. It’s up 3% year to date. The NASDAQ closed the week at 9,250.51, up 1.0% from 9,150.94 last week. It’s up 6.1% year to date.
U.S. treasury bond yields slightly higher – The 10-year treasury bond closed the week yielding 1.59%, up from 1.51% last week. The 30-year treasury bond yield ended the week at 2.05%, up from 1.99% last week. We watch treasury bond yields because mortgage rates often follow bond yields.
Mortgage rates lowest in 3 years - The Freddie Mac Primary Mortgage Survey released on February 6, 2020 reported mortgage rates for the most popular loan products as follows: The 30-year fixed mortgage rate average was 3.45%, down from 3.51% last week. The 15-year fixed was 2.97%,down from 3.0% last week. The 5-year ARM was 3.32, up from 3.24% last week.