DJIA Ten Day Winning Streak
The nine-day winning streak on the Dow Jones Industrial Average (DJIA) was its
longest since 1996, until Thursday when the DJIA ended positive, for the tenth
consecutive trading session. The DJIA marked its 10 day winning streak today
which will be the 25th time the DJIA has achieved this feat in 70 years. In
January 1987, the DJIA hit a winning streak of 13 days. The longest winning
streak in the history of the DJIA was in June 1897 when the DJIA struck 14
straight days of gains. The strength of the winning streak delivered a 2.85%
gain, making it the fifth weakest of 25 such moves.
The FTSE 100 stock index closed up 0.7% at 6,529.41 on Thursday to mark a
five-year high. The move came on the heels of a historical run on Wall Street.
A bipartisan group of Senators, all of which are on the U.S. Senate Banking,
Housing and Urban Affairs Committee, are aiming to spur substantive reform of
the government's role in housing finance with the "Jumpstart GSE Reform Act".
The GSE Reform would prevent Congress from using increases in certain fees
charged by mortgage buyers Fannie Mae (FNMA) and Freddie Mac (FMCC) to offset
other government spending. Additionally, as part of the GSE Reform, the U.S.
Department of the Treasury would be prohibited from selling its preferred shares
in Fannie and Freddie without prior approval from Congress. "We know our housing
finance system is not sustainable in its current form, and this legislation will
keep us on a path to accomplish real reforms. We believe that as we transition
Fannie and Freddie out of their present roles, we need to think about the system
in its entirety," said Sen. Mark Warner, a Democrat of Virginia and one of the
bill's sponsors. Senator Elizabeth Warren of Massachusetts is the other
Democratic sponsor for GSE Reform. Republican sponsors for GSE Reform are: Bob
Corker of Tennessee and David Vitter of Louisiana.
During February, foreclosure starts - the first stage of the foreclosure process
- rose 10% compared to foreclosure starts in January. Surging foreclosure starts
from 2012 levels for the following states which also have large backlogs of
delinquent mortgages due to new state laws governing foreclosures and/or the
fact that they require a judge in the process: Nevada up 334%; Maryland up 319%;
Washington up 172%; New York up 139%; New Jersey up 70%. "At a high level the
U.S. foreclosure inferno has been effectively contained and should be reduced to
a slow burn in the next two years," said Daren Blomquist, vice president at
RealtyTrac. "But dangerous foreclosure flare-ups are still popping up in states
where foreclosures have been delayed by a lengthy court process or by new
legislation making it more difficult to foreclose outside of the court system.
Foreclosure starts have been steadily building in those states over the last
several months and likely will end up as bank repossessions or short sales later
this year." New foreclosure starts in California during February rose by 41%,
the first gain since July 2012. A new law in California designed to protect
homeowners, the California Homeowner Bill of Rights, in addition to the $25
billion National Mortgage Settlement with mortgage servicers over so-called
"robo-signing" foreclosure paperwork fraud, helped to reduce foreclosures in the
state. "The strongest correlation we see is that states with the biggest jumps
in foreclosure starts are states with some of the most pro-active foreclosure
prevention legislation over the past few years. We believe that resulted in a
short-term drop in foreclosure activity but is now resulting in a backlash of
delayed foreclosures," says Blomquist.
U.S. Commerce Department reported Thursday that Q4 U.S. current account deficit
narrowed to the lowest since Q3 2011 to $110.4 billion or 2.8% of gross domestic
product (GDP). Increases in the surpluses of income and services were a key
contributor. Current account deficit increased to $475 billion or 3% of GDP, for
2012 for the largest annual current account deficit since 2008. Current account
surplus for the U.S. has not occurred since 1991. The deficit is slightly above
the record low of 2.5% set in Q2 of 2009, as a percentage of GDP. During Q4, net
financial inflows dropped to $58.4 billion from $68.3 billion.
U.S. Labor Department reported on Thursday that for week ended March 9, the
number of people applying for new U.S. unemployment benefits fell by 10,000 to
332,000, marking the second lowest level in five years. Over the past month
Labor said the average of new unemployment claims declined by 2,750 to 346,750,
for the lowest level in five years. For week ended March 2, Labor said
continuing unemployment claims decreased by 89,000 to a seasonally adjusted 3.02
U.S. Labor Department reported on Thursday that during February, U.S. wholesale
prices shot up a seasonally adjusted 0.7%, driven by a spike in gasoline costs.
Gasoline prices jumped 7.2% for the biggest monthly gain since September. Core
wholesale prices rose a smaller 0.2%, excluding food and energy. As the cost of
diesel, gasoline, home heating oil and natural gas all rose, energy prices
climbed 3.0% during February. Largely due to a decline in the cost of fresh and
dry vegetables, food prices fell 0.5%. Core rate has risen 1.7%, down from 1.8%
in January and well within the Federal Reserve's 2% to 2.5% target range for
inflation and suggests there's little reason for the central bank to halt its
latest economic-stimulus program
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