Major stock indices fell over fears of additional rate hikes and a slowing economy.  While manufacturing and services appear to be slowing, housing starts surged in May.

FED chair Powell testified before the House and Senate and stated that interest rates will need to go higher to bring inflation down to the Fed’s 2% target.

The Bank of England surprised the markets with a half point interest rate hike to 5.0%

Treasury bond yields fell with the 30-year bond yield at 3.812%and the 10-Year note at 3.742%.  Freddie Mac reported that 30-year mortgage rates fell to 6.67%.  Crude oil fell to $69.51 a barrel and natural gas rose to $2.731 per MMBTUs.  The U.S. dollar index rose to 102.87 and gold fell to $1930.30 an ounce.

• The National Association of Realtors reported that existing home sales rose a seasonally adjusted 0.2% in May.
  • Existing home prices fell 3.1% in May from a year ago, the biggest drop in over 11 years.
• The Commerce Department reported:
• • Housing starts rose 21.7% in May versus April, the biggest monthly increase since 2016.
    • Starts were 5.7% above May 2022.
    • Single family starts rose 18.5% in May.
    • Multi-family starts (5 or more units) rose 28.1%.
  • Permits, an indication of future housing starts, rose 5.2% in May but are down 12.7% from last May.
• The Labor Department reported:
  • Seasonally adjusted first-time claims for unemployment were 264,000 unchanged from the previous week’s revised level.
    • The 4-week moving average of claims, designed to smooth out volatility, were 255,750 an increase of 8500 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 oil fell from 12.4MM barrels per day to 12.2MM BPD.
  • Natural gas storage rose 95BN cubic feet and is above the 5-year average at this time of year.
• Baker Hughes reported the number of active oil rigs fell 6 to 546.  The number of active natural gas was unchanged at 130.

Please call us if you have any questions.

Loren C. Rex, CFP^®, MA                                                                      Erik A Smith, AIF®

Founder / Emeritus                                                                            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.

 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/construction/nrc/pdf/newresconst.pdf