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‘Relatively Soon’ Rise for Interest Rates as Mortgage Rates Shoot Up Post Election

By Beth McGuire

A rise in the key interest rate could come “relatively soon,” Federal Reserve Chair Janet Yellen reiterated on Thursday, heightening the probability the Fed will forge ahead with a hike in December, despite initial doubts in the wake of Donald Trump’s presidential victory. Mortgage rates, which generally follow the key rate, shot up this week, with the 30-year fixed rate mortgage topping out at an average 3.94 percent from 3.57 percent the week prior.

“This week, the verdict is in—over the last two weeks, the 30-year mortgage rate jumped 40 basis points to 3.94 percent, almost identical to the 39 basis point increase in the 10-year Treasury yield,” says Sean Becketti, Freddie Mac’s chief economist. “If rates stick at these levels, expect a final burst of home sales and refinances as ‘fence sitters’ try to beat further increases, then a marked slowdown in housing activity.”

Yellen’s position—which comes as the dust settles after one of the most contentious elections in history—reinforces the sentiments of Federal Reserve Bank of Philadelphia President Patrick Harker and Federal Reserve Bank of St. Louis President James Bullard, who both voiced support for future hikes this week.

Yellen also echoed the Fed’s intent to only gradually raise the key rate. The Fed last raised the rate in December 2015.

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JP Morgan to pay $264 million fine to settle charges of corrupt hiring practices in Asia

J.P. Morgan Chase & Co. has agreed to pay a total of $264 million to settle charges related to its hiring practices in Asia, the Securities and Exchange Commission said Thursday. The bank will pay more than $130 million to the SEC, $72 million to the Justice Department and $61.9 million to the Federal Reserve to settle the charges, said the SEC. J.P. Morgan was alleged to have hired people in China and other countries in the region who were relatives and friends of government officials or clients as a way to get an unfair advantage in winning business. The practice is a violation of the Foreign Corrupt Practices Act, said the SEC. In a seven-year period, the bank hired about 100 interns and full-time employees at the request of foreign officials, garnering more than $100 million in revenue for the firm. “JPMorgan engaged in a systematic bribery scheme by hiring children of government officials and other favored referrals who were typically unqualified for the positions on their own merit,” said Andrew J. Ceresney, Director of the SEC Enforcement Division. “JPMorgan employees knew the firm was potentially violating the FCPA yet persisted with the improper hiring program because the business rewards and new deals were deemed too lucrative.” The bank’s stock was up about 0.8% on Thursday, and has gained 18% in the year so far, outperforming the S&P 500’s roughly 7% gain.

Market Pulse Stories are Rapid-fire, short news bursts on stocks and markets as they move. Visit MarketWatch.com for more information on this news.

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From:: Stock Market News

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JP Morgan to pay $264 million fine to settle charges of corrupt hiring practices in Asia

J.P. Morgan Chase & Co. has agreed to pay a total of $264 million to settle charges related to its hiring practices in Asia, the Securities and Exchange Commission said Thursday. The bank will pay more than $130 million to the SEC, $72 million to the Justice Department and $61.9 million to the Federal Reserve to settle the charges, said the SEC. J.P. Morgan was alleged to have hired people in China and other countries in the region who were relatives and friends of government officials or clients as a way to get an unfair advantage in winning business. The practice is a violation of the Foreign Corrupt Practices Act, said the SEC. In a seven-year period, the bank hired about 100 interns and full-time employees at the request of foreign officials, garnering more than $100 million in revenue for the firm. “JPMorgan engaged in a systematic bribery scheme by hiring children of government officials and other favored referrals who were typically unqualified for the positions on their own merit,” said Andrew J. Ceresney, Director of the SEC Enforcement Division. “JPMorgan employees knew the firm was potentially violating the FCPA yet persisted with the improper hiring program because the business rewards and new deals were deemed too lucrative.” The bank’s stock was up about 0.8% on Thursday, and has gained 18% in the year so far, outperforming the S&P 500’s roughly 7% gain.

Market Pulse Stories are Rapid-fire, short news bursts on stocks and markets as they move. Visit MarketWatch.com for more information on this news.

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From:: Stock Market News

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Natural-gas futures extend losses after EIA reports 30 billion-cubic-foot rise in U.S. supplies

Natural-gas futures extended their earlier losses Thursday after the U.S. Energy Information Administration reported that supplies of the commodity rose 30 billion cubic feet for the week ended Nov. 11. That matched the increase expected by analysts polled by S&P Global Platts. Total stocks now stand at 4.047 trillion cubic feet, up 51 billion cubic feet from a year ago and 216 billion cubic feet above the five-year average, the government said. December natural gas fell 5.6 cents, or 2%, from Wednesday’s settlement to $2.708 per million British thermal units. It traded at $2.739 before the data.

Market Pulse Stories are Rapid-fire, short news bursts on stocks and markets as they move. Visit MarketWatch.com for more information on this news.

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From:: Stock Market News

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Federal prosecutors to charge Valeant, Philidor execs with fraud and kickback scheme: WSJ

Federal prosecutors are gearing up to charge Valeant Pharmaceuticals International Inc. executive Gary Tanner and former Philidor Rx Services LLC Chief Executive Andrew Davenport with engaging in a multi-million-dollar fraud and kickback scheme, The Wall Street Journal reported Thursday. The move comes after a probe of the Canada-based drug company and its ties to Philidor, a mail-order pharmacy that boosted sales of its drugs, the paper said. U.S. Attorney for the Southern District of New York Preet Bharara is scheduled to announced the charges at a noon press conference. Valeant didn’t immediately respond to a request for comment. Shares fell 6.7% in early trade, and are down 84% in the year so far, while the S&P 500 has gained 6.8%.

Market Pulse Stories are Rapid-fire, short news bursts on stocks and markets as they move. Visit MarketWatch.com for more information on this news.

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From:: Stock Market News

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Director of National Intelligence James Clapper resigns, reports say

Director of National Intelligence James Clapper has submitted his resignation, reports said Thursday. Clapper’s resignation comes just over a week after Donald Trump defeated Hillary Clinton in the presidential election.

Market Pulse Stories are Rapid-fire, short news bursts on stocks and markets as they move. Visit MarketWatch.com for more information on this news.

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From:: Stock Market News

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Microsoft’s stock surges after Goldman Sachs turns bullish

Shares of Microsoft Corp. tacked on 1% in morning trade, after Goldman Sachs turned bullish on the technology giant, citing accelerating growth in the companies cloud business. Analyst Heather Bellini raised her rating to buy, after being at neutral since Dec. 18. She raised her stock price target to $68, which is 13% above current levels, from $60. Bellini said Microsoft’s Azure is the number two market share vendor in the cloud space, and has at least doubled in size year-over-year in eight of the last 10 quarters. “With a large Microsoft customer base and strong C-level relationships, we believe Azure can continue to grow revenue and improve margins over time,” Bellini wrote in a note to clients. The stock is still down 0.3% since the election and down 1.2% from its Oct. 24 record close of $61. It has climbed 8.6% year to date, while the SPDR Technology Select Sector ETF has rallied 10% and the Dow Jones Industrial Average has gained 8.4%.

Market Pulse Stories are Rapid-fire, short news bursts on stocks and markets as they move. Visit MarketWatch.com for more information on this news.

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From:: Stock Market News

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Stock market opens flat ahead of Yellen testimony

Stocks opened little changed Thursday, struggling for direction in early trade ahead of congressional testimony by Federal Reserve Chairwoman Janet Yellen. Ahead of an appearance before the Joint Economic Committee, Yellen said an interest-rate hike could come “relatively soon,” doing little to dispel exepctations the central bank could deliver a rate increase as soon as next month. The S&P 500 fell less than 0.1% to 2,176.85 while Dow industrials fell 9 points to 18,858. The Nasdaq Composite declined 0.1% to 5,291.48.

Market Pulse Stories are Rapid-fire, short news bursts on stocks and markets as they move. Visit MarketWatch.com for more information on this news.

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Housing starts see greatest leap in nearly a decade

Housing starts increased significantly in October, reversing a downward trend and holding its strongest pace since 2007. Interestingly enough, Millennials played a major role in this increase due to their increasing market share. There is still room for growth, however, and one expert explains what housing needs to see from the next administration. Click the headline to read more. …read more

From:: Real Estate Wire