Major stock indices ended the week with little change.  Economic data showed a sharp decline in May’s new home sales and slowing inflation.  May’s core personal consumption expenditures rose only 0.1% in May and is up 2.6% from a year ago but incomes rose 0.5% and consumption rose 0.2%.

Treasury bond yields rose with the 30-year bond yield at 4.423% and the 10-Year note at 4.270%.  Freddie Mac reported that the average 30-year mortgage rate fell to 6.86%.  Crude oil rose to $81.81 a barrel and natural gas fell to $2.682 per MMBTUs.  The U.S. dollar index rose to 105.88 and gold fell to $2341.80 an ounce.

In economic reports this week:

• The Commerce Department reported:
  • Sales of new homes fell 11.3% in May from April’s revised rate and are down 16.5% from last May.
  • The median sales price of a new home rose to $417,400 up from $407,600.

• • Gross Domestic Product in the 1^st quarter was revised up from a 1.3% to a 1.4% annual rate.
• Personal consumption expenditures rose 0.2% in May.
  • Personal incomes rose 0.5%.
  • The PCE price index was unchanged in May and is up 2.6% from a year ago.
    • Excluding volatile food and energy the PCE index rose 0.1% and is up 2.6% from last May.  This is the FED’s preferred measure of inflation.
• The Labor Department reported:
  • Seasonally adjusted first-time claims for unemployment were 233,000, a decrease of 6,000 from the previous week’s revised level.
    • The 4-week moving average of claims, designed to smooth out volatility, was 236,000, an increase of 3,000 from the previous week’s revised level. 
    • For the full unemployment report go here:  https://www.dol.gov/ui/data.pdf .
• The EIA weekly oil report is here: http://ir.eia.gov/wpsr/wpsrsummary.pdf .  Also, the EIA reported in the prior week:
  • Field production of crude was unchanged at 13.2MM BPD.
  • Natural gas storage rose 52BN cubic feet and was above the highest level during the past five years at this time of year.
• Baker Hughes reported the number of oil rigs fell 6 to 479 and the number of natural gas rigs fell 1 to 97.

Please call us if you have any questions.

Loren Rex – Emeritus

Erik A Smith, AIF® – President & C.E.O.

These are the opinions of Loren Rex and Erik Smith and are not necessarily those of Cambridge, are for informational purposes only, and should not be construed or acted upon as individualized investment advice. The Indices mentioned are unmanaged and cannot be invested into directly. The Dow Jones Industrial Average, Dow Jones, or simply the Dow, is a stock market index of 30 prominent companies listed on stock exchanges in the United States. The DJIA is one of the oldest and most commonly followed equity indexes. The Nasdaq Composite is a stock market index that includes almost all stocks listed on the Nasdaq stock exchange (more than 2500 stocks).

Sources:

https://www.eia.gov/dnav/pet/hist/LeafHandler.ashx?n=PET&s=WCRFPUS2&f=W

https://ir.eia.gov/ngs/ngs.html

https://www.freddiemac.com/pmms

https://www.wsj.com/market-data?mod=nav_top_subsection

https://bakerhughesrigcount.gcs-web.com/na-rig-count

https://www.census.gov/economic-indicators

https://www.nar.realtor/newsroom/existing-home-sales-edged-lower-by-0-7-in-may-as-median-sales-price-reached-record-high-of-419300

https://www.bea.gov/news/2024/gross-domestic-product-third-estimate-corporate-profits-revised-estimate-and-gdp-industry

https://www.bea.gov/news/2024/personal-income-and-outlays-may-2024