Economic Update For The Week Ending September 4, 2021
U.S. employers added 235,000 jobs in August – The Department of Labor and Statics reported that 235,000 new jobs were added in August . That number shocked analysts as economists surveyed by Dow Jones had predicted 720,000 new jobs. Experts point to a pullback in hiring due to a surge in new COVID cases. For example, the leisure and hospitality sector had been gaining 350,000 jobs a month for the last six months, but that stalled in August. There were also 400,000 workers that said could not work for pandemic-related reasons. Average hourly wages rose 4.3% year over year. The unemployment rate was 5.2% in August, down from 5.4% in July. It has fallen from a high of 14.8% at the start of the pandemic, but is a long way off from its 3.5% rate before the pandemic.
Stock Markets – Stock indexes remained mostly stable this week. Despite a disappointing jobs report that shocked experts, a hurricane that caused massive damage and flooding throughout the eastern U.S., and no letup in sight on the latest wave of COVID-19 cases, investors remained unfazed. The Dow Jones Industrial Average closed the week at 35,369.01, down 0.2% from 35,455.80 last week. It is up 15.6% year-to-date. The S&P 500 closed the week at 4,534.43, up 0.6% from 4,509.37 last week. It is up 20.6% year-to-date. The NASDAQ closed the week at 15,363.52, up 1.6% from 15,129.50 last week. It is up 19% year-to-date.
U.S. Treasury bond yields – The 10-year treasury bond closed the week yielding 1.33%, almost unchanged from 1.31% last week. The 30-year treasury bond yield ended the week at 1.94%, up slightly from 1.91% last week. We watch bond yields because mortgage rates often follow treasury bond yields.
Mortgage rates – The September 2, 2021, Freddie Mac Primary Mortgage Survey reported mortgage rates for the most popular loan products as follows: The 30-year fixed mortgage rate was 2.87%, unchanged from 2.87% last week. The 15-year fixed was 2.18%, unchanged from 2.17% last week. The 5-year ARM was 2.43%, unchanged from 2.42% last week.