Wednesday’s Mid-Day Movers: 3 Stories Driving Markets
The U.S. equity markets were posting thin gains on Wednesday afternoon after having opened lower. The most recent round of earnings helped restore some investor confidence, even as concerns remained that a gathering of euro-zone finance officials tomorrow would bring bad tidings.
At 1:00 p.m.: DJIA: +0.04%, S&P 500: +0.08%, NASDAQ: +0.03%.
1) Despite increasing interest rates, applications for home mortgages in the United States rose last week and refinancing accounted for a slightly smaller portion of that activity.
The Mortgage Bankers Association said on Wednesday that its seasonally adjusted index of mortgage application activity — which includes both refinancing and home purchase demand — jumped 3.4 percent in the week ended February 1. This compares to a decrease of 8.1 percent in the previous week. On an unadjusted basis, the index jumped 16 percent. This report follows data released yesterday that revealed that home prices increased year-over-year in December for the tenth consecutive month, partially due to low mortgage rates… (Read more.)
2) Republican leaders were quick to shoot down a package of spending cuts and tax reforms proposed by President Barack Obama and aimed at patching some of the issues associated with the sequester due on March 1. As scheduled, the sequester would cut federal spending by about $85 billion the first year it is in effect and by a total of $1.2 trillion through 2022.
The first signs of ideological trench warfare in Washington have appeared, but congressional leaders and market participants are hoping to avoid another fiscal cliff-style showdown. In a report published yesterday, the Congressional Budget Office wrote that “if the current laws that govern federal taxes and spending do not change, the budget deficit will shrink this year to $845 billion, or 5.3 percent of gross domestic product, its smallest size since 2008.” Those current laws include the sequester.
3) The overhaul of fuel technologies isn’t limited to cars: The same story can be seen in electricity generation for the whole country. As increasingly stricter standards are set to protect the environment, the coal industry may take a major hit. Everyone knows there are some dangers in coal mining. Almost any film featuring a coal mine also features an accident. In the past 3 years, 88 people have died in coal mining accidents. But these accidents are not the only hazards associated with the energy-rich black rock… (Read more.)