Dow Glum Following China Meeting as Investors Await Bernanke Speech
The Dow Jones Industrial Average is down more than 0.3% so far this morning following some disappointment regarding Chinese economic reform. The four-day Third Plenum meeting, in which analysts hoped the Communist Party would speak of specific economic reforms, left many feeling that the vague press release published yesterday points to no meaningful changes being made in China's vast economy.
Markets could also be a bit edgy ahead of an evening speech by Federal Reserve Chairman Ben Bernanke. Although the talk is targeted toward educators and will include a more historical view of the Fed, Bernanke will take questions -- which is probably where investors will be focusing their attention, hoping for some concrete information on the winding-down of quantitative easing.
The Mortgage Bankers Association released its weekly report earlier today, showing that mortgage applications fell by 1.8% last week. The release also held a nugget of good news on the mortgage front: The association noted it has revised the drop in home-loan applications for its last reading to a mere 2.8% reduction compared to the decrease of 7% it previously announced.
Interest rate rise isn't hurting Home Depot
Rising interest rates dampen demand for mortgages, which isn't great news for banks like JPMorgan Chase , the second-largest mortgage-originator behind heavy-hitter Wells Fargo. Already suffering from a slumping mortgage business, banks like JPMorgan will likely see more pain as home prices continue to climb and price more potential home-buyers out of the market. JPMorgan Chase is down 0.6%.
The mortgage news isn't depressing the stock of Home Depot , which is up by more than 1% today. House sales are a good thing for the giant home-improvement retailer. But a home-selling market put on hold may still bode well for the company, particularly as sellers may feel the need to perform extra sprucing-up activities in order to make their homes more enticing. Also giving Home Depot a boost today could be an article by The Street in which the store's gift card is hailed as one of the 10 best gift cards for the holiday season.
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The article Dow Glum Following China Meeting as Investors Await Bernanke Speech originally appeared on Fool.com.Fool contributor Amanda Alix has no position in any stocks mentioned. The Motley Fool recommends Home Depot and Wells Fargo. The Motley Fool owns shares of JPMorgan Chase and Wells Fargo. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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