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Stocks up ahead of key inflation data – CPI dips in December – Bitcoin rises – Wells Fargo stepping back from housing market – Mortgage rate dip sparks refinances – FTX recovers $5 billion
Stock futures rose slightly on Thursday as investors await a key inflation report from the Federal Reserve, which will assess the outlook and probability of future interest rate hikes.
The Dow Jones Industrial Average advanced by 87 points, or 0.3%, while the S&P 500 futures gained 0.3%, and Nasdaq-100 futures added 0.2%, CNBC reported.
The benchmark US 10-Year Treasury Note was down -0.083 for a yield of 3.473% as of 8:57 AM EST.
In oil futures, Brent crude was up +1.27, trading at $83.94, while WTI crude was up +1.18, at $78.66.
The Consumer Price Index (CPI) fell 0.1% in December, matching a Dow Jones estimate, and marked the largest monthly decline since April 2020. However, on a year-over-year basis, CPI rose 6.5%, well above the Fed’s target of 2%. “Core CPI,” which strips out food and energy prices, had a gain of 0.3% in December, also meeting expectations, CNBC reported.
Bitcoin, the world’s largest digital currency, rose above $18,000 for the first time since December 14, increasing its value by roughly 5% in the last 24 hours, CNBC reported.
Attorneys for collapsed crypto exchange FTX said on Wednesday they had found around $5 billion in “liquid” assets, including cash and digital assets. However, the full extent of customer losses in the collapse of the company remains unknown, an attorney for FTX told the U.S. Bankruptcy Court, Yahoo Finance reported. The attorney also said the company plans to sell non-strategic investments that had a book value of $4.6 billion.
Wells Fargo announced it is stepping back from the housing market, as well as shuttering the business that buys loans made by third-party lending while “significantly” scaling back its mortgage-servicing portfolio. The company will now focus on home loans for existing bank and wealth management customers, as well as borrowers in minority communities, CNBC reported. The move comes amid the impact of higher interest rates and regulatory pressures. Wells Fargo has declined to comment on or quantify how many jobs will be lost.
The average interest rate on a 30-year fixed-rate mortgage with conforming loan balances ($647,200 or less) decreased last week to 6.42% from 6.58%. The dip in rates motivated consumers to apply for home loan refinancing, which saw applications increase by 5 percent, CNBC reported. However, the drop in rates did not do the same for new home loans, with total mortgage application volume rising just 1.2 percent last week compared to the previous week, according to the Mortgage Bankers Association’s seasonally adjusted index.
