Weekly Market & Economic News Recap (Week of May 29, 2023)

• Home prices rose in March for second straight month. Case-Shiller index climbs 0.4% as shortage of homes for sale spurs competition among home buyers. (Wall Street Journal, May 30, 2023, https://www.wsj.com/articles/home-prices-rose-in-march-for-second-straight-month-dbc1553a?mod=economy_more_pos6)

• Debt-Ceiling deal does little to change direction of federal spending and economy. Plan, if approved, would avert potential financial disaster caused by a government default. (Wall Street Journal, May 31, 2023, https://www.wsj.com/articles/debt-ceiling-deal-does-little-to-change-direction-of-federal-spending-economy-d613388?mod=economy_more_pos5)

• Inflation in the eurozone declined to a 15-month low in May, opening a window for the European Central Bank to pause its aggressive interest-rate increases. (Wall Street Journal, June 1, 2023, https://www.wsj.com/articles/cooling-eurozone-inflation-opens-path-for-ecb-rate-pause-7df8b1c2?mod=economy_more_pos2)

• Libor’s last users face challenges as the deadline for its demise nears. Thirty days before the borrowing benchmark ceases in its current form, some U.S. companies are still contemplating transition work and options for extending its use. (Wall Street Journal, June 1, 2023, https://www.wsj.com/articles/libor-last-users-face-challenges-as-the-deadline-for-its-demise-nears-8f69e179?mod=markets_major_pos13)

• The Dow is soaring because traders still see Fed on hold in June after blowout payrolls report. (MarketWatch, June 2, 2023, https://www.marketwatch.com/story/traders-price-in-increased-risk-of-june-fed-rate-hike-after-may-jobs-data-e85a7733?mod=markets_major_pos12)

• U.S. job openings climbed in April and layoffs fell in signs that employers’ demand for workers remains strong as the economy gradually slows. Employers reported a seasonally adjusted 10.1 million job openings in April, the Labor Department said Wednesday, up from a revised 9.7 million in March. (Wall Street Journal, June 3, 2023, https://www.wsj.com/articles/u-s-job-openings-rose-in-april-reversing-three-months-of-decline-a3dde727?mod=economy_lead_pos5)

• Bond bulls ignore Fed-hike noise and keep buying yield spikes. Market pricing suggests one more Fed hike, but likely in July. Investors swooped in to buy during recent Treasury selloffs. (Bloomberg, June 3, 2023, https://www.bloomberg.com/news/articles/2023-06-03/bond-bulls-ignore-fed-hike-noise-and-keep-buying-yield-spikes?srnd=null)

• Prelude to Fed features two global rate cliffhangers. Australia and Canada decisions offer foretaste of US quandary. World Bank and OECD forecasts, Lagarde testimony also due. (Bloomberg, June 3, 2023, https://www.bloomberg.com/news/articles/2023-06-03/prelude-to-fed-features-two-global-rate-cliffhangers-eco-week?srnd=economics-v2)

• ETF providers rush to tap into AI investing craze. New actively managed funds give investors broader exposure to artificial intelligence development. (Wall Street Journal, June 4, 2023, https://www.wsj.com/articles/etf-providers-rush-to-tap-into-ai-investing-craze-3ca8e0c2?mod=markets_lead_pos3)

• Biden debt-bill signing set to unleash tsunami of US debt sales. Treasury expected to sell $1 trillion or more of new debt. Department ran down cash to keep making federal payments. (Bloomberg, June 4, 2023, https://www.bloomberg.com/news/articles/2023-06-04/biden-debt-bill-signing-set-to-unleash-tsunami-of-us-debt-sales?srnd=economics-v2)