This was the worst week for mortgage rates in 3 years – and it may be just the beginning

The good news is that rates are still incredibly low, and in the weeks before this turnaround, rates had fallen to the lowest level in three years. “August was the best month for mortgage rates, and 2019 has been the best year since 2011. Mortgage rates loosely follow the yield on the 10-year Treasury. While moves in the Federal Reserve’s rates can affect bond yields, mortgage rates are not necessarily tied to Fed rate cuts or increases. While mortgage rates are still historically low, so many b


The good news is that rates are still incredibly low, and in the weeks before this turnaround, rates had fallen to the lowest level in three years. “August was the best month for mortgage rates, and 2019 has been the best year since 2011. Mortgage rates loosely follow the yield on the 10-year Treasury. While moves in the Federal Reserve’s rates can affect bond yields, mortgage rates are not necessarily tied to Fed rate cuts or increases. While mortgage rates are still historically low, so many b
This was the worst week for mortgage rates in 3 years – and it may be just the beginning Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-09-13  Authors: diana olick
Keywords: news, cnbc, companies, higher, mortgage, week, shortterm, worst, rate, lows, beginning, rates, performances, low, points


This was the worst week for mortgage rates in 3 years – and it may be just the beginning

The average rate on the 30-year fixed is now 20 basis points higher than it was on Monday and 36 basis points higher than its last low on Sept. 4, according to Mortgage News Daily.

That is the biggest short-term jump since the week following the election of President Trump.

That is the bad news for borrowers. The good news is that rates are still incredibly low, and in the weeks before this turnaround, rates had fallen to the lowest level in three years.

“These sorts of bad performances are most often seen in the wake of stellar performances,” said Matthew Graham, chief operating officer of Mortgage News Daily. “August was the best month for mortgage rates, and 2019 has been the best year since 2011. And that’s precisely why this terrible week is possible: It’s largely a technical correction to the feverish strength in August.”

Analysts now wonder if this is a short-term correction from those recent lows or a new shift toward rising rates.

“The big risk here is that the overall rate rally — the one that began in November 2018—has run its course,” said Graham.

If the market “can match 2011’s performance, there’s a chance rates will move to new all-time lows by the end of the year,” he added. But that would require “some legitimate deterioration in the global growth outlook.”

Mortgage rates loosely follow the yield on the 10-year Treasury. While moves in the Federal Reserve’s rates can affect bond yields, mortgage rates are not necessarily tied to Fed rate cuts or increases.

While mortgage rates are still historically low, so many borrowers have already refinanced, that the pool of those left who could benefit is extremely rate sensitive.


Company: cnbc, Activity: cnbc, Date: 2019-09-13  Authors: diana olick
Keywords: news, cnbc, companies, higher, mortgage, week, shortterm, worst, rate, lows, beginning, rates, performances, low, points


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Trump says Fed ‘boneheads’ should cut interest rates to zero ‘or less,’ US should refinance debt

President Donald Trump on Wednesday continued his verbal assault on the Federal Reserve, who he blames for slowing the economy, tweeting that the central bank should cut interest rates to zero or even set negative interest rates. “The Federal Reserve should get our interest rates down to ZERO, or less, and we should then start to refinance our debt. This isn’t a mortgage, this is U.S. Treasury debt. I think it would be incredibly disruptive to financial markets, and interest rates would ultimate


President Donald Trump on Wednesday continued his verbal assault on the Federal Reserve, who he blames for slowing the economy, tweeting that the central bank should cut interest rates to zero or even set negative interest rates. “The Federal Reserve should get our interest rates down to ZERO, or less, and we should then start to refinance our debt. This isn’t a mortgage, this is U.S. Treasury debt. I think it would be incredibly disruptive to financial markets, and interest rates would ultimate
Trump says Fed ‘boneheads’ should cut interest rates to zero ‘or less,’ US should refinance debt Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-09-11  Authors: jeff cox john melloy, jeff cox, john melloy
Keywords: news, cnbc, companies, fed, debt, zero, rates, interest, economy, trump, treasury, refinance, boneheads, united, cut, reserve


Trump says Fed 'boneheads' should cut interest rates to zero 'or less,' US should refinance debt

This is a developing story. Check back for updates.

President Donald Trump on Wednesday continued his verbal assault on the Federal Reserve, who he blames for slowing the economy, tweeting that the central bank should cut interest rates to zero or even set negative interest rates. The president also called Fed officials “boneheads” in the tweet.

“The Federal Reserve should get our interest rates down to ZERO, or less, and we should then start to refinance our debt. INTEREST COST COULD BE BROUGHT WAY DOWN, while at the same time substantially lengthening the term,” he said.

The president also made a new suggestion not seen in some of his past attacks on the Fed, saying that the country should refinance its debt load.

“It’s not viable and could be a significant problem for investors, financial markets and ultimately the economy,” said Mark Zandi, chief economist at Moody’s Analytics. “The debt is not prepayable. There’s a contractual relationship the Treasury has with investors. This isn’t a mortgage, this is U.S. Treasury debt. I think it would be incredibly disruptive to financial markets, and interest rates would ultimately rise, not fall.”

It’s unclear how such an idea would work. The Treasury Department likely would have to be involved, and there have been calls recently to issue longer-term debt, such as a 50- or 100-year Treasury.

“From a theoretical standpoint, obviously it would be wonderful for the United States government over a period of year if it were to lengthen the maturities on debt that would have rates below 1%,” said banking analyst Dick Bove at Odeon Capital Group. “It would certainly be beneficial to the United States government. Whether it would be beneficial to the United States economy is an open question.”

Cutting rates to zero or below would cheapen debt costs but also make the U.S. a less desirable spot for capital flow as the ability to generate yield would disappear.

Trump had made a suggestion during the 2016 presidential campaign that would have involved renegotiating the debt. That idea then was widely dismissed as a move the actually could drive Treasury yields higher, jeopardize the nation’s standing among its creditors and pose a threat to the U.S. dollar as the world’s reserve currency.

During a CNBC interview in May 2016, Trump said that if the economy turned south, he would try to get creditors to accept partial payment on U.S. debt.

“I would borrow, knowing that if the economy crashed, you could make a deal,” he said then.

His idea was that the U.S. would pay less than face value on the Treasury debt it issues to cover the burgeoning budget deficit. However, doing so would only increase the costs of issuing the debt as creditors would demand higher interest payments.

Trump has long bemoaned Fed policy, saying the central bank should get more in line with the near-zero rates employed by the nation’s global competitors. The Fed currently targets its benchmark overnight lending rate in a range between 2% and 2.25%, the highest of any G-7 nation.

In previous tweets, he has repeatedly ripped his own appointee, Fed Chairman Jerome Powell, as being out of step with the economic needs in the U.S.

“The USA should always be paying the the lowest rate. No Inflation! It is only the naïveté of Jay Powell and the Federal Reserve that doesn’t allow us to do what other countries are already doing. A once in a lifetime opportunity that we are missing because of “Boneheads,” Trump said in Wednesday’s tweets.


Company: cnbc, Activity: cnbc, Date: 2019-09-11  Authors: jeff cox john melloy, jeff cox, john melloy
Keywords: news, cnbc, companies, fed, debt, zero, rates, interest, economy, trump, treasury, refinance, boneheads, united, cut, reserve


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Jamie Dimon says JP Morgan is preparing for the risk of zero rates in the US

Jamie Dimon said that while he doubts the wave of negative interest rates in countries around the world will reach the U.S., he’s preparing J.P. Morgan Chase for the possibility anyway. “Obviously, you’ve got to worry about the long term effect of those interest rates,” Dimon said. Dimon, chairman and CEO of J.P. Morgan, admitted that the drop in U.S. interest rates surprised him. Last year, he said that rates should rise and that the 10-year Treasury yield could reach 4%. The bank can trim cost


Jamie Dimon said that while he doubts the wave of negative interest rates in countries around the world will reach the U.S., he’s preparing J.P. Morgan Chase for the possibility anyway. “Obviously, you’ve got to worry about the long term effect of those interest rates,” Dimon said. Dimon, chairman and CEO of J.P. Morgan, admitted that the drop in U.S. interest rates surprised him. Last year, he said that rates should rise and that the 10-year Treasury yield could reach 4%. The bank can trim cost
Jamie Dimon says JP Morgan is preparing for the risk of zero rates in the US Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-09-10  Authors: hugh son
Keywords: news, cnbc, companies, morgan, risk, businesses, reach, zero, rates, preparing, jamie, negative, dimon, interest, countries, yield


Jamie Dimon says JP Morgan is preparing for the risk of zero rates in the US

Jamie Dimon said that while he doubts the wave of negative interest rates in countries around the world will reach the U.S., he’s preparing J.P. Morgan Chase for the possibility anyway.

“I don’t think we’ll have zero rates in the U.S., but we’re thinking about how to be prepared for it, just in the normal course of risk management,” Dimon said Tuesday at a conference in New York.

“Obviously, you’ve got to worry about the long term effect of those interest rates,” Dimon said. “But it’s hard. There are businesses it doesn’t affect at all. And there are businesses where it just sucks into your margin and there’s very little you can do about it.”

Dimon, chairman and CEO of J.P. Morgan, admitted that the drop in U.S. interest rates surprised him. Last year, he said that rates should rise and that the 10-year Treasury yield could reach 4%.

The 10-year yield was at 1.69% on Tuesday, down from 2.68% to start the year. It fell as low as 1.44% last month as investors rushed into Treasuries on fears of a global economic slowdown and as the Federal Reserve cut rates. Benchmark bonds in major countries like Germany are trading with negative yields.

The bank can trim costs and charge clients more account fees to make up for squeezed margins as rates fall, Dimon said.


Company: cnbc, Activity: cnbc, Date: 2019-09-10  Authors: hugh son
Keywords: news, cnbc, companies, morgan, risk, businesses, reach, zero, rates, preparing, jamie, negative, dimon, interest, countries, yield


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The huge and swift shift into value stocks from momentum shares may be all about rates

A sudden shift from momentum stocks to value plays could mean investors are betting on higher interest rates. Bespoke Investment Group compared two exchange-traded funds by MSCI, the Momentum factor ETF and the Value factor ETF, to illustrate the trend. According to these ETFs, momentum stocks are up 2.8% this week, while value stocks are down 3.5%, a very large diversion for such a short amount of time. The Momentum ETF used in this comparison invests large- and mid-capitalization stocks that h


A sudden shift from momentum stocks to value plays could mean investors are betting on higher interest rates. Bespoke Investment Group compared two exchange-traded funds by MSCI, the Momentum factor ETF and the Value factor ETF, to illustrate the trend. According to these ETFs, momentum stocks are up 2.8% this week, while value stocks are down 3.5%, a very large diversion for such a short amount of time. The Momentum ETF used in this comparison invests large- and mid-capitalization stocks that h
The huge and swift shift into value stocks from momentum shares may be all about rates Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-09-10  Authors: al lewis
Keywords: news, cnbc, companies, stocks, value, higher, shares, rates, shift, etf, week, huge, interest, lower, swift, yields, momentum


The huge and swift shift into value stocks from momentum shares may be all about rates

A sudden shift from momentum stocks to value plays could mean investors are betting on higher interest rates.

This week there’s been a dramatic rotation from the high-valuation stocks that have driven the market’s run-up to more steady companies with lower valuations.

Bespoke Investment Group compared two exchange-traded funds by MSCI, the Momentum factor ETF and the Value factor ETF, to illustrate the trend.

According to these ETFs, momentum stocks are up 2.8% this week, while value stocks are down 3.5%, a very large diversion for such a short amount of time.

The spread between these two funds tracks yields on the 10-year Treasury reasonably well, as seen in the chart below, but this week it has broken away.

The breakout, which follows a recent uptick in bond yields, means one of two things, said Bespoke analyst George Pearkes.

“Either equities are over-reacting to the recent move higher in rates, or they’re predicting a more extended turn higher in yields,” he wrote.

Bond yields continued rising on Tuesday with the 2-year at 1.654% and the 10-year up to 1.697%.

The improvement in yields comes even as the Federal Reserve is widely expected to lower its key rate when it meets later this month. It also stands in contrast to what central banks around the globe have been doing: cutting rates into negative integers and increasing quantitative easing operations to fend off a global economic downturn.

It’s perhaps counterintuitive that the market would be expecting these higher yields to last for long in a global interest rate environment that includes nearly $17 trillion in negative-yielding debt.

The Momentum ETF used in this comparison invests large- and mid-capitalization stocks that have enjoyed big moves in valuation. It’s top five holdings are Visa, Mastercard, Microsoft, Procter & Gamble and Walt Disney.

The Value ETF, buys U.S. large- and mid-capitalization stocks with relatively lower valuations. It holds AT&T, Intel, IBM, Pfizer and Bank of America in in its top five.

Beyond signaling a bet on interest rates, a repositioning from momentum to value could indicate a flight to safety for investors concerned about a downturn, even as the market hovers around new highs.

“If interest rates are done falling and about to turn higher, it hurts high growth stocks with sky-high P/E ratios by diminishing the future value of earnings and raising borrowing costs,” Pearkes said.


Company: cnbc, Activity: cnbc, Date: 2019-09-10  Authors: al lewis
Keywords: news, cnbc, companies, stocks, value, higher, shares, rates, shift, etf, week, huge, interest, lower, swift, yields, momentum


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Former Fed Vice Chair Kohn backs rate cut, rejects Dudley suggestion to foil Trump

In a CNBC interview, Kohn indicated he believes the Fed will follow market expectations and lower its benchmark overnight lending rate by 25 basis points at its Sept. 17-18 meeting. The economy is fine, it’s growing around 2%, has been growing around 2% for the last year. Market expectations are for another cut in either October or December, followed by an additional easing in early 2020. “I’m much less certain than the market seems to be that we need a whole bunch of decreases here,” he said. D


In a CNBC interview, Kohn indicated he believes the Fed will follow market expectations and lower its benchmark overnight lending rate by 25 basis points at its Sept. 17-18 meeting. The economy is fine, it’s growing around 2%, has been growing around 2% for the last year. Market expectations are for another cut in either October or December, followed by an additional easing in early 2020. “I’m much less certain than the market seems to be that we need a whole bunch of decreases here,” he said. D
Former Fed Vice Chair Kohn backs rate cut, rejects Dudley suggestion to foil Trump Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-09-10  Authors: jeff cox
Keywords: news, cnbc, companies, trump, suggestion, kohn, fed, vice, dudley, rates, rejects, cut, rate, foil, trumps, market, thing, think


Former Fed Vice Chair Kohn backs rate cut, rejects Dudley suggestion to foil Trump

The Federal Reserve should cut interest rates next week and not listen to a suggestion that it consider keeping rates level to harm President Donald Trump’s re-election chances, former central bank Vice Chairman Donald Kohn said Tuesday.

In a CNBC interview, Kohn indicated he believes the Fed will follow market expectations and lower its benchmark overnight lending rate by 25 basis points at its Sept. 17-18 meeting.

“I think they have ample reason to do that. The economy is fine, it’s growing around 2%, has been growing around 2% for the last year. The unemployment rate is low,” he said on “Closing Bell.” “But there are downside risks there from the trade war and the global slowdown, and inflation is running a bit below their target.”

However, he said he’s not sure how far the policymaking Federal Open Market Committee should go beyond that.

Market expectations are for another cut in either October or December, followed by an additional easing in early 2020. The FOMC already has cut once this year, a 25 basis point reduction that was the first since 2008 after having raised the funds rate nine times since December 2015. The funds rate is currently targeted between 2% and 2.25%.

“So I think buying a bit more insurance is the right thing to do at this meeting. What I’m not so sure about is where they will be going after that,” he said.

“I’m much less certain than the market seems to be that we need a whole bunch of decreases here,” he said.

He did express certainty against a suggestion from former New York Fed President Bill Dudley, who argued in a Bloomberg Opinion piece that the FOMC should push back against Trump’s intense criticism of the Fed by not lowering rates. Doing so, Dudley wrote, might hamper Trump’s re-election which he called “a threat to the U.S. and global economy.”

“I thought it was wrong and harmful,” Kohn said of Dudley’s commentary. “The Fed needs to keep away from politics. They need to apply the best economic analysis possible to achieve legislative mandates.”

He said writing the piece was “a very dangerous thing to do.”

CNBC has reached out to Dudley for comment.


Company: cnbc, Activity: cnbc, Date: 2019-09-10  Authors: jeff cox
Keywords: news, cnbc, companies, trump, suggestion, kohn, fed, vice, dudley, rates, rejects, cut, rate, foil, trumps, market, thing, think


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Investors see less gloom, dump winners and buy economically sensitive stocks

Interest rates have been rising for the same reason, and some investors are betting that Treasury yields may have bottomed for now. “You had everyone piling into the software names because they were a great place to hide during the trade war. In August, Treasury yields hit record and multi-year lows, with the the 10-year yield, as low as 1.42% on Sept. 3, was at 1.64% Tuesday. The momentum trade and the defensive trade is unwinding,” said Hogan. The prices have been bottoming for probably two or


Interest rates have been rising for the same reason, and some investors are betting that Treasury yields may have bottomed for now. “You had everyone piling into the software names because they were a great place to hide during the trade war. In August, Treasury yields hit record and multi-year lows, with the the 10-year yield, as low as 1.42% on Sept. 3, was at 1.64% Tuesday. The momentum trade and the defensive trade is unwinding,” said Hogan. The prices have been bottoming for probably two or
Investors see less gloom, dump winners and buy economically sensitive stocks Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-09-10  Authors: patti domm
Keywords: news, cnbc, companies, trade, buy, market, momentum, dump, sensitive, rates, longer, stocks, winners, growth, 10year, yields, treasury, economically, investors, gloom


Investors see less gloom, dump winners and buy economically sensitive stocks

Traders and financial professionals work on the floor of the New York Stock Exchange (NYSE) at the opening bell on August 15, 2019 in New York City.

Sentiment has shifted in part because of signs of improvement in the trade talks between the U.S. and China. Interest rates have been rising for the same reason, and some investors are betting that Treasury yields may have bottomed for now.

The cheapest stocks, those with the lowest price-to-earnings ratios were snapped up, while many of the most expensive companies, or those with the highest price to earnings ratios, were being sold.

There’s a shift underway in the stock market that may be signalling that some investors believe there was way too much pessimism on Wall Street this summer, and the stocks that do better in an improving economy are the ones to buy for now.

“You had everyone piling into the software names because they were a great place to hide during the trade war. Now they are talking about making some strides,” said Christian Fromhertz, CEO of The Tribeca Trade Group.

“Again, people are not optimistic for the most part on them getting anything done, but as headlines come out … there is a mad rush out of the safety areas of the market.”

Art Cashin, director of floor operations at UBS, said the move away from pricier stocks has the may be an asset reallocation trade. “It may be as simple as taking profits on things that move and investing in others, hoping we’d get closer to a trade deal,” he said. “That may be part of what you’re seeing.”

According to a study by CNBC’s Chris Hayes, the 50 stocks in the S&P 500 with the highest forward P/Es, meaning the most expensive, were down an average 0.8% Tuesday afternoon, with 64% trading lower. The 50 stocks in the index with the lowest P/Es, or the relatively cheapest, rose an average 2.3%, and 90% were trading higher Tuesday.

Art Hogan, chief market strategist at National Securities, said a move out of growth into value appears to be tied as well to the idea that for now, interest rates have bottomed. In August, Treasury yields hit record and multi-year lows, with the the 10-year yield, as low as 1.42% on Sept. 3, was at 1.64% Tuesday.

“All the stuff in the middle has started to outperform. The momentum trade and the defensive trade is unwinding,” said Hogan. “It feels like it’s been triggered because yields have bottomed. That low on the U.S. 10-year feels like an overshoot.”

The Treasury market was flashing dire warnings this summer, when the yield curve inverted at the same time there were few signs of hopefulness around the trade talks. An inversion, in this case in the 2-year and 10-year yields, is when the rates on a shorter duration security rises above a longer dated one, in this case the 10-year note. The curve is no longer inverted, but an inversion can be a reliable recession warning.

“With a low growth, weaker economic backdrop, there are two types of names you want to own. One is secular growth, which is less cyclical, like Mastercard or Microsoft,” said Robert Sluymer, technical strategist at Fundstrat. “As soon as rates start to stabilize, the valuations around them can be ratcheted down pretty quickly.”

Traders have been following the action in iShares Edge MSCI USA Momentum Factor MTUM, down for a third day after hitting a high last week. The ETF was off 1.7%, and is down about 3.5% this week alone.

“I think secular growth is still longer term leadership, but there’s a rotation away from a lot of the bond proxies to the cyclical side of the market. A lot of those cyclicals, whether it’s Caterpillar or Eaton, they peaked at the end of 2017 and beginning of 2018,” said Sluymer. “They’ve been declining ever since. The prices have been bottoming for probably two or three months, but those longer term momentum indicators are turning positive. We would recommend trimming bond proxies and adding to cyclicals.”


Company: cnbc, Activity: cnbc, Date: 2019-09-10  Authors: patti domm
Keywords: news, cnbc, companies, trade, buy, market, momentum, dump, sensitive, rates, longer, stocks, winners, growth, 10year, yields, treasury, economically, investors, gloom


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‘Gold is the way to go’ as interest rates fall, says Mark Mobius

VCG | Visual China Group | Getty ImagesVeteran investor Mark Mobius is bullish on gold as central banks around the world cut interest rates. “All the central banks are trying to get interest rates down, they are pumping money into the system. In the first half of this year, central banks bought 374 metric tons of gold, reported the World Gold Council. The 2019 Central Bank Gold Reserve survey, conducted by the World Gold Council and released in July, also found there was central bank demand for


VCG | Visual China Group | Getty ImagesVeteran investor Mark Mobius is bullish on gold as central banks around the world cut interest rates. “All the central banks are trying to get interest rates down, they are pumping money into the system. In the first half of this year, central banks bought 374 metric tons of gold, reported the World Gold Council. The 2019 Central Bank Gold Reserve survey, conducted by the World Gold Council and released in July, also found there was central bank demand for
‘Gold is the way to go’ as interest rates fall, says Mark Mobius Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-09-09  Authors: huileng tan
Keywords: news, cnbc, companies, council, gold, mark, interest, fall, demand, dollar, banks, mobius, currency, central, way, world, system, rates


'Gold is the way to go' as interest rates fall, says Mark Mobius

A staff member shows gold ornaments at a jewelry store on June 21, 2019 in Huzhou, Zhejiang Province of China. VCG | Visual China Group | Getty Images

Veteran investor Mark Mobius is bullish on gold as central banks around the world cut interest rates. “Physical gold is the way to go, in my view, because of the incredible increase in money supply,” said Mobius, the founding partner of Mobius Capital Partners. “All the central banks are trying to get interest rates down, they are pumping money into the system. Then, you have all of the cryptocurrencies coming in, so nobody really knows how much currency is out there,” he told CNBC’s “Street Signs” on Friday. Amid expectations of slowing global growth, central banks around the world have been lowering interest rates, as they seek to boost money supply in the economy, stoke demand and provide an impetus to growth.

Mobius recommends that investors hold 10% of their portfolios in physical gold, with the rest invested in dividend yielding equities. That’s especially if the dollar gets weaker. In his view, “the U.S. government, the Trump White House, does not want a strong dollar.” “They are certainly going to try to weaken the dollar against other currencies and of course, it’s a race to the bottom. Because, as soon as they do that, other currencies will also weaken,” said Mobius. “People are going to finally realize that you got to have gold, because all the currencies will be losing value,” he added. Gold can retain its value much better than other forms of currency, and is traditionally a safe haven during market volatility. A weaker dollar tends to boost the price of gold as global trade in the yellow metal is denominated in U.S. dollars. “At the end of the day, gold is a means of exchange. It’s a stable currency in some way,” said Mobius.

Central banks are buying gold

Data from the World Gold Council this year point to rising central bank demand for the yellow metal amid global macroeconomic uncertainty. In the first half of this year, central banks bought 374 metric tons of gold, reported the World Gold Council. That was the largest net increase for the first half of the year since at least 2000. “Deep down inside, the central bankers do believe in gold, but they don’t want to say it because … they won’t be able to create new currency,” said Mobius. The 2019 Central Bank Gold Reserve survey, conducted by the World Gold Council and released in July, also found there was central bank demand for gold in the short to medium term. Of those polled, 11% of emerging market and developing economy central banks said they intended to increase their gold reserves over the next 12 months. That was similar to data from 2018 when 12% of such central banks bought gold, giving rise to 652 metric tons of central bank gold demand — the highest level on record under the current international monetary system, noted the World Gold Council. “The planned purchases are being driven by higher economic risks in reserve currencies. In the medium term, central banks see changes in the international monetary system, with a greater role for the Chinese renminbi and gold,” said the World Gold Council in their report. The renminbi is another name for the Chinese yuan. About 40% of emerging market and developing economy central banks cited “anticipated changes in the international monetary system being relevant to their decision to hold gold,” the World Gold Council said.

China also investing in gold


Company: cnbc, Activity: cnbc, Date: 2019-09-09  Authors: huileng tan
Keywords: news, cnbc, companies, council, gold, mark, interest, fall, demand, dollar, banks, mobius, currency, central, way, world, system, rates


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Fall housing shifts quickly to a buyer’s market

“We do expect housing market activity to remain relatively stable, and the favorable rate environment should continue supporting increased refinance activity.” At an open house in Dallas on Sunday, a few dozen potential buyers toured a home listed at just under $1.4 million. “It’s not a seller’s market right now. McMahon said the concern is less about the overall health of the housing market, and more about the future of the economy. Darrell and Carrie Smith toured the Dallas open house but are


“We do expect housing market activity to remain relatively stable, and the favorable rate environment should continue supporting increased refinance activity.” At an open house in Dallas on Sunday, a few dozen potential buyers toured a home listed at just under $1.4 million. “It’s not a seller’s market right now. McMahon said the concern is less about the overall health of the housing market, and more about the future of the economy. Darrell and Carrie Smith toured the Dallas open house but are
Fall housing shifts quickly to a buyer’s market Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-09-09  Authors: diana olick
Keywords: news, cnbc, companies, shifts, quickly, sellers, rates, fall, market, open, housing, survey, house, think, dallas, buyers


Fall housing shifts quickly to a buyer's market

An Open house in Dallas, Sunday, Sept. 8, 2019. Bethany Jordan | CNBC

Mortgage rates are around the lowest in three years, but buyers are suddenly much more cautious about purchasing a home. Competition is cooling, and consequently sellers can no longer command any price. Consumer sentiment in housing did improve in August, according to a monthly survey from Fannie Mae, but only because of a big jump in the share of those who think mortgage rates will keep falling. Other components of the survey were not so rosy. Fewer people think now is a good time to buy or sell a home, and fewer said they are not concerned about losing their job in the next year. “Unfortunately, much of the lower interest rate environment can be attributed to global economic uncertainties, which appear to have dampened consumer sentiment regarding the direction of the economy,” said Doug Duncan, chief economist at Fannie Mae. “We do expect housing market activity to remain relatively stable, and the favorable rate environment should continue supporting increased refinance activity.”

At an open house in Dallas on Sunday, a few dozen potential buyers toured a home listed at just under $1.4 million. The agent for the home said the market is still moving, but buyers are getting more picky. “I definitely think it has softened a bit,” said Kelley McMahon a Dallas-area agent with Compass. “It’s not a seller’s market right now. Now is not the time for sellers to put out these crazy prices. Appraisals have gotten a lot harder, and buyers are a little more cautious. They’re more willing to take their time.” McMahon said the concern is less about the overall health of the housing market, and more about the future of the economy. “I think people are a little more cautious to pull the trigger, and I definitely think that people want to get through the election year, just kind of see what happens,” she added. That is clearly showing up in the competition, or lack thereof. Just more than 10% of offers written by Redfin in August faced a bidding war, according to the brokerage’s monthly survey. That is down from 42% a year ago. The supply of homes for sale is growing in the midrange and higher end, but it is still tight at the entry level, where low rates matter most because buyers are more cash-strapped. “Despite remaining near three-year lows, mortgage rates have failed to bring enough buyers to the market to rev up competition for homes this summer,” said Daryl Fairweather, chief economist at Redfin. “Recession fears have been enough to spook some would-be buyers from making the big financial commitment of a home purchase.” Darrell and Carrie Smith toured the Dallas open house but are still considering enlarging their current home instead of buying something bigger.


Company: cnbc, Activity: cnbc, Date: 2019-09-09  Authors: diana olick
Keywords: news, cnbc, companies, shifts, quickly, sellers, rates, fall, market, open, housing, survey, house, think, dallas, buyers


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Stocks are expected to break out to new highs, barring any errant presidential trade tweets

The S&P 500 is about 1.7% away from its late July high of 3,027.98, and stocks have recently been driven higher by strength in technology and consumer discretionary stocks. “For the camp that wants to see new all-time highs, they would like to see the S&P 500 to hold 2,940 to 2,955. Usually a weak month, the S&P 500 was up 1.7% so far for September, as of Monday. Stocks started Monday higher, but were mixed to flattish in afternoon trading, as technology stocks gave up some gains. Small caps are


The S&P 500 is about 1.7% away from its late July high of 3,027.98, and stocks have recently been driven higher by strength in technology and consumer discretionary stocks. “For the camp that wants to see new all-time highs, they would like to see the S&P 500 to hold 2,940 to 2,955. Usually a weak month, the S&P 500 was up 1.7% so far for September, as of Monday. Stocks started Monday higher, but were mixed to flattish in afternoon trading, as technology stocks gave up some gains. Small caps are
Stocks are expected to break out to new highs, barring any errant presidential trade tweets Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-09-09  Authors: patti domm
Keywords: news, cnbc, companies, stocks, tweets, barring, higher, positive, highs, expected, economic, rates, 500, presidential, errant, break, trade, market


Stocks are expected to break out to new highs, barring any errant presidential trade tweets

The stock market is itching to make new highs, and it may soon, as long as progress continues to appear to be made on the trade war front. Technical market analysts, who watch stock charts, see an opportunity for stocks to break above previous highs, after the S&P 500 rose above its 50-day moving average last week and crossed above August highs, two signals of positive momentum. For fundamental analysts, there are other positives in place for stocks, including a possible bottom in interest rates, central bank easing and a pick up in some economic data. But the one wild card is the trade war, which appears to be making progress with talks planned for October between U.S. and Chinese officials. The S&P 500 is about 1.7% away from its late July high of 3,027.98, and stocks have recently been driven higher by strength in technology and consumer discretionary stocks. Both sectors are within 2% of all-time highs. “Technically, it set itself up, and now it has to keep itself there,” said Scott Redler, partner with T3Live.com. “For the camp that wants to see new all-time highs, they would like to see the S&P 500 to hold 2,940 to 2,955. The longer it holds that, the more likely it will be make 3028, the all-time high.” September has started off on positive footing after August’s decline. Usually a weak month, the S&P 500 was up 1.7% so far for September, as of Monday. On Monday, the S&P closed at 2,978, down 0.2%. Stocks started Monday higher, but were mixed to flattish in afternoon trading, as technology stocks gave up some gains. Small caps, however, were outperforming, with the Russell 2000 up 1.2% in afternoon trading. Small caps are a sector that has been lagging and was expected to rise as the market returned to its highs. Bond yields, which have moved to worrisome low levels in August, have been higher in September. The 10-year Treasury was yielding 1.63% Monday afternoon.

‘Shakeout summer’

“Last week’s action was meaningful from a trading basis, in that we broke above the August range, the upper end of the range being 2,940,” on the S&P 500, said Ari Wald, technical analyst at Oppenheimer. “I think the underappreciated point for us is the market is coming off cyclically oversold levels.” in the past 52 weeks, the S&P has moved higher by just 2.75%, he added. “After such little market progress, we’re starting to see signs conditions are getting better and global equities are beginning to base in a move higher,” said Wald. He said the market is still reacting to last year’s sell-off, and is now in a position for a move higher. “When it’s done raining, it’s still wet outside, and that’s what we had in 2019. The storm was in 2018 when we had the big downturn in December,” Wald said. “2019 has been base building… It was our case there would be a shakeout summer.” Wald said there is also a negative attitude on the part of investors, which could act as a contrarian positive. “The way things are shaping, I think we could experience a nice run up in the equity market in the next 12 months. Clients, and investors, are just coming up with every reason possible not to buy stocks. it’s very telling, on a contrarian basis,” he said.

Trump tweets

James Paulsen, chief investment strategist at Leuhtold Group, said there are fundamental factors at work, that are also helping stocks and could push them to highs. “It’s near an all-time high but a mid-morning tweet could put it back,” said Paulsen, adding that the trade headlines have created turbulence for stocks. Strategists say tweets from President Donald Trump could move the market in either direction, and recently his trade tweets have been more negative than positive. “It does seem, since the Trump tweet [on trade] in early August…the biggest thing that’s changed since then is the global economic reports have gotten better on average,” said Pauslen. Paulsen said he has been watching economic surprise indexes, and they are rising globally. The indexes measure beats against misses on economic data, and when they are positive it is perceived as good news for the stock market. “Momentum might be improving. Along with that is recession fears are receding. Rates are going back up,” said Paulsen. When rates hit very low levels in August, the move reflected fears of a recession and stocks were also shaky. Paulson said the improvement in the economic data is coming as some prior central bank easing is having an impact. “We’re focused on the Fed and the ECB, but there’s been easing for nine months, and that’s starting to come home to roost.” But he cautions that if the yield curve does not steepen and is inverted that could undermine investor confidence, since it is a recession warning. The yield curve is inverted when short term intrest rates are higher than long duration rates. He said the Fed should cut rates by 50 basis points to help the process. The European Central Bank meets this week and it is expected to take some action to possibly cut its already negative yields and boost its asset purchase program. The Fed meets next week, and it is expected to cut interest rates at least by a quarter point. JP Morgan equity strategists expect the stock market to rise into year end, and they see a list of reasons to be positive about. “Better technicals, light positioning, more favourable seasonals, signs of a trough inactivity momentum, potential de-escalation in trade uncertainty, 2nd Fed cut— which might move ahead of market expectations this time, and finally the up coming restart of ECB’s QE are likely to be the positive catalysts for this up move, in our view,” the strategists wrote in a note.

U.S. economic surprise index


Company: cnbc, Activity: cnbc, Date: 2019-09-09  Authors: patti domm
Keywords: news, cnbc, companies, stocks, tweets, barring, higher, positive, highs, expected, economic, rates, 500, presidential, errant, break, trade, market


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Fed chief Powell says trade policy is weighing on investment decisions

Federal Reserve Chairman Jerome Powell said Friday that the trade war between China and the U.S. is weighing down companies’ investment decisions. “I think it is the case that uncertainty around trade policy is causing some companies to hold back now on investment,” Powell said in Switzerland. China and the U.S. have been engaged in a trade war that has rattled financial markets since last year. The uncertainty around trade has contributed to the Fed easing its stance on monetary policy, followi


Federal Reserve Chairman Jerome Powell said Friday that the trade war between China and the U.S. is weighing down companies’ investment decisions. “I think it is the case that uncertainty around trade policy is causing some companies to hold back now on investment,” Powell said in Switzerland. China and the U.S. have been engaged in a trade war that has rattled financial markets since last year. The uncertainty around trade has contributed to the Fed easing its stance on monetary policy, followi
Fed chief Powell says trade policy is weighing on investment decisions Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-09-06  Authors: fred imbert
Keywords: news, cnbc, companies, decisions, uncertainty, economy, trade, sector, weighing, fed, chief, war, investment, powell, policy, rates


Fed chief Powell says trade policy is weighing on investment decisions

Federal Reserve Chairman Jerome Powell said Friday that the trade war between China and the U.S. is weighing down companies’ investment decisions.

“I think it is the case that uncertainty around trade policy is causing some companies to hold back now on investment,” Powell said in Switzerland. “We’ve been hearing quite a bit about uncertainty. So for businesses, to particularly make longer-term investments in plants or equipment or software, they want some certainty that the demand will be there.”

China and the U.S. have been engaged in a trade war that has rattled financial markets since last year. In August, an escalation between the two countries led U.S. equities to their biggest one-month loss since May.

Tensions between China and the U.S. thawed slightly this week after Chinese trade officials said they would fly to Washington next month to continue negotiations. However, expectations of the two sides reaching a deal are low.

The uncertainty around trade has contributed to the Fed easing its stance on monetary policy, following other central banks overseas. The Fed cut rates by 25 basis points in July and is expected to trim rates again later this month.

Powell said lower rates are helping to keep the U.S. economy in a good place. The U.S. services sector expanded at a faster-than-expected rate in August, according to data from the Institute of Supply Management released Thursday. However, the U.S. manufacturing sector contracted for the first time since 2016 last month.

The chairman also said he does not expect the U.S. economy to fall into a recession.

—CNBC’s Tom Franck contributed to this report.

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Company: cnbc, Activity: cnbc, Date: 2019-09-06  Authors: fred imbert
Keywords: news, cnbc, companies, decisions, uncertainty, economy, trade, sector, weighing, fed, chief, war, investment, powell, policy, rates


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