May 25, 2020

Weekly Market Commentary May 18th to May 22nd 2020

Housing Starts fell by -30% in April to an annualized level of 891k. New Building Permits were weak during the month as well, down by -21% to 1,074k. These are levels not seen since 2014.

Despite an 18% drop in Existing Home Sales from March to April, demand is still out there for home purchases. Low mortgage rates are keeping demand alive despite the challenges associated with showing homes and transacting during a period of restrictive social distancing orders.

Weekly Jobless Claims were reported at 2.4 million. While the numbers continue to decline weekly, the cumulative number of total new claims over the past nine weeks is remarkable at over 38 million.

The S&P 500 advanced by 3.2 this week to 2,955. The NASDAQ closed at 9,324, higher by 3.4%. As Q1 corporate earnings reporting season wraps up, investors are bracing for a second quarter with little to gauge expectations on. Many companies have suspended forward guidance as business and social restrictions begin to ease at varied paces in each state throughout the country.

The 10-Year U.S. Treasury rose to 0.74% during the week before closing back down to where it started at 0.63%.

Key economic data to be released in the holiday-shortened week includes an updated estimate of Q1 GDP, Durable Goods Orders, New Home Sales and a closely watched update on Weekly Jobless Claims.

We hope you enjoy a safe and healthy Memorial Day long weekend.