Despite mixed data the major averages enter the final hour with modest gains. The Mortgage Bankers Association reports that it’s activity index fell 1.7% last week as refi’s dropped 3%, purchase apps slipped .9%. The 30-year contract rate for a jumbo loan held steady at 4.68%.
2nd quarter GDP or Gross Domestic Product was revised slightly higher to 4.2%, beating expectations. Fixed investment, consumer spending and exports improved. While inventories and housing investment slipped. Real disposable income growth slowed to 2.5% after the temporary tax cut boost faded. Pulling down the saving rate from 7.2% in the first quarter to 6.8%. Corporate Profits rose 3.3% in Quarter 2, gross domestic income rose 1.8% over the same period.
Pending home sales fell again in July falling to 106.2 on declines in the South and Western regions. On a year ago basis this series fell for a 7th consecutive month. All regions registered year ago declines for a second consecutive month, the West fell a notable 5.8% from a year ago and is by far the weakest region of them all.
Agricultural prices advanced .1% in June. Led by huge jump in fruit prices and to a much lesser extent poultry and egg prices. Prices paid by farmers fell for a second month in the last 3, down .2%.
It’s been said that he Devil is in the details and it would seem that fanfare aside. The trade deal with Mexico is hardly the huge victory it was initially held out to be. Analysis by Bloomberg and the Wall Street Journal or WSJ both found that the deal left a lot to be desired and was in fact worse than NAFTA in some ways, Bloomberg went so far as to call it a “lemon”. While the WSJ called it half a NAFTA. Once again Trump demonstrates that he is long on talk and bravado, and woefully short on actual substance.
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