Tuesday, July 2, 2013

Rising Mortgage Rates Boost Home Buying (excerpt)

During May, the sum of new and existing single-family home sales rose to 5.1 million units (saar), the best pace since November 2009, when tax incentives boosted sales. The four-week average of mortgage applications to purchase a house remains on an uptrend through the week of June 21 despite the rise in mortgage rates.

The index of pending existing home sales soared in May to a new cyclical high. This suggests that the initial reaction to rising mortgage rates is to prompt would-be homebuyers to close their deals pronto.

Today's Morning Briefing: Have a Nice Day Trade. (1) The first trading day of the month tends to be a winner. (2) The M-PMI is always released on that day. (3) Lots of good news in both ISM and Markit M-PMIs for US. (4) Good, but not great, for S&P 500 revenues. (5) Better, but not wonderful, news in M-PMIs out of Europe. (6) Plenty of other solid indicators. (7) Commodity prices holding up despite weakness in Chinese M-PMI. (8) New record high for US trucking index. (9) Rising mortgage rates boosting existing home sales. (10) Tax revenues at new highs. (11) Forward earnings at new highs. (More for subscribers.)

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