Stock markets closed higher this week – Stock markets surged this week on positive economic news. The Consumer Price Index (CPI), the broadest reading of inflation, showed that consumer prices increased 4% in May from one year ago. While a long way off the Fed’s 2% target, it was the lowest reading in two years, and well off its peak of 9.2% last June. The Fed left their key interest rates unchanged at their meeting this week. That marked the first pause after ten straight meetings ending in rate hikes. Another report released this week showed that retail sales unexpectedly jumped in May. Consumers remain optimistic and very resilient. The Dow Jones Industrial Average closed the week at 34,299.12, up 1.2% from 33,876.78 last week. It is up 3.5% year-to-date. The S&P 500 closed the week at 4,409.59, up 2.8% from 4,298.14 last week. It is up 14.8% year-to-date. The Nasdaq closed the week at 13,689.57, up 3.2% from 13,259.14 last week. It is up 30.8% year-to-date.
U.S. Treasury bond yields – The 10-year treasury bond closed the week yielding 3.77%, up slightly from 3.75% last week. The 30-year treasury bond yield ended the week at 3.86%, down slightly from 3.89% 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 June 15, 2023 were as follows: The 30-year fixed mortgage rate was 6.69%, down slightly from 6.71% last week. The 15-year fixed was 6.10%, up slightly from 6.07% last week.