Housing Bottom: Are we there yet?
Housing was the epicenter of the last decade's boom and bust. House prices doubled between 2000 and 2006, fueled by an abundance of easy credit sloshing around the globe. Since the bubble burst, the S&P/Case-Shiller National U.S. Home Price Index tanked 33.8 percent from the peak, recorded in Q2 of 2006. The housing depression has wiped out more than $7 trillion in homeowners' equity, has led to 5 million foreclosures or short sales and, according to CoreLogic, has given rise to 11.1 million households owing more on the their mortgages than their properties are worth (negative equity).
Speaking of the economy, the slightly better-than-expected data last week (retail sales, manufacturing, weekly claims) and the stress test results for the nation's largest banks, led to a solid week of gains for stocks. US stock indexes all closed above key psychological thresholds: Dow 13,000, S&P 500 1400 and NASDAQ 3,000.
-- DJIA: 13,232, up 2.4% on week, up 8.3% on year (best weekly gain of the year)
-- S&P 500: 1404, up 2.4%, up 11.6% on year (up 4.58% over the last five weeks)
-- NASDAQ: 3055, up 2.2%, up 17.2% on year (up 5.2% over the last five weeks)
-- May Crude Oil: $107.58, up 0.001% on week
-- April Gold: $1655.80, down 3.2% on the week
-- AAA National Average Price for Gallon of Regular Gas: $3.83 (up from $3.52 a month ago, gas prices up approximately 18% in 2012)
FACTOIDS OF THE WEEK, Stress Test Edition: It's been four years since the Bear Stearns canary in a coal mine moment of failure. From March 16, 2008 to Friday's close, here's how some of the largest bank stocks have fared, according to the New York Times Dealbook:
-- PMorgan Chase: +22.3%
-- Wells Fargo: +19.8%
-- Goldman Sachs: -21.5%
-- Morgan Stanley -50.7%
-- Bank of America -74.1%
-- Citigroup -81.7%
THE WEEK AHEAD:
1:00 NAHB Housing Market Index
Greece due to repay 14.5 euros of debt
8:30 Housing Starts and Building Permits
7:00 Weekly mortgage applications
10:00 Existing Home Sales
Fed releases stress tests on big banks
8:30 Weekly jobless claims
10:00 Leading Economic Indicators
10:00 FHFA Home Price Index
10:00 New Home Sales
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