Stock markets continued to post strong results this week – The 2023 stock market rally continued this week. The Nasdaq has risen almost 35% from the start of the year. The S&P and Dow are within 6% of their all-time highs. Second quarter corporate earnings have been strong. Nearly 80% of companies that have reported so far have exceeded expectations. Companies appear to have managed high inflation, and with inflation taming investors have jumped back into the market. The Dow Jones Industrial Average closed the week at 35,227.69, up 2.1% from 34,509.93 last week. It is up 6.3% year-to-date. The S&P 500 closed the week at 4,536.34, up 0.7% from 4,505.92 last week. It is up 18.1% year-to-date. The Nasdaq closed the week at 14,090.80, down 0.2% from 14,113.70 last week. It is up 34.6% year-to-date.
U.S. Treasury bond yields – The 10-year treasury bond closed the week yielding 3.84% almost unchanged from 3.83% last week. The 30-year treasury bond yield ended the week at 3.91%, almost unchanged from 3.93% last week. We watch bond yields because mortgage rates follow bond yields.
Mortgage rates – The Freddie Mac Primary Mortgage Survey reported that mortgage rates for the most popular loan products as of July 20, 2023, were as follows: The 30-year fixed mortgage rate was 6.78%, down from 6.98% last week. The 15-year fixed was 6.06% down from 6.30% last week.
U.S. existing-home sales – The National Association of Realtors reported that existing-home sales totaled 4.16 million units on a seasonally adjusted annualized rate in June, down 18.9% from an annualized rate of 5.13 million in June 2022. The median price for a home in the U.S. in June was $410,200, down 0.9% from $413,800 one year ago. There was a 3.1-month supply of homes for sale in June, up from a 2.9-month supply last June. First-time buyers accounted for 27% of all sales. Investors and second-home purchases accounted for 18% of all sales. All-cash purchases accounted for 26% of all sales. Foreclosures and short sales accounted for 2% of all sales.
California existing-home sales – The California Association of Realtors reported that existing-home sales totaled 277,490 on a seasonally adjusted annualized basis in June, down 19.7% from an annualized 378,640 homes that closed escrow last June. Year-to-date the number of homes sold were down 32.9% from the same period last year. The statewide median price paid for a home in May was $838,260, up 0.3% from May, but down 2,4% from $858,800 last June. There was a 2.2-month supply of single-family homes for sale in June, down from a 2.4-month supply one year ago.