Mortgage rates declined, easing for the third straight week, according to a report from mortgage finance giant Freddie Mac.
Rates for 30-year fixed-rate mortgages (FRMs) averaged 6.35% in the week ending Sept. 4, according to Freddie Mac (FRE, Fortune 500). That’s down from last week, when it stood at 6.4%, and below a year ago, when the rate stood at 6.46%.
Other rates also fell. Freddie’s Primary Mortgage Market Survey showed that the 15-year FRM fell to a 5.9% average from 5.93% last week and from 6.15% last year.
"Mortgage rates eased a bit over the holiday-shortened week following release of economic data that suggest consumer spending may slow," Frank Nothaft, Freddie Mac vice president and chief economist, said in a statement.
"The economy grew at an upwardly revised 3.3% pace in the second quarter, boosted by the smallest trade deficit in eight years, and residential fixed investment slowed growth by 0.6%, the least amount since the same period a year ago," Nothaft further noted.
Five-year adjustable-rate mortgages (ARMs) averaged 5.97% this week, dropping from last week when it reported at 6.03% and from last year at this time when it was at 6.32%.
The ARM average decline is on the heels of a Fitch Ratings report on Tuesday that warned of growing default rates within ARM mortgages.
With an ARM mortgage, the payment for the first five years does not have to even cover interest rate payments online payday advance. The interest that accumulates is placed on the mortgage, and borrowers have to pay more of the growing amount every month after the first five years. The Fitch report stated that payments of this type of mortgage will jump, and delinquency rates could double on these loans within the next two years.
Still, one-year ARMs averaged 5.15%, a decline from 5.33% last week and 5.74% last year, according to Freddie’s survey.
The average retail price of a gallon of gasoline in Texas jumped nearly 7 cents this week, despite oil and gas producers reporting little damage from Hurricane Gustav.
According to AAA-Texas, Houston continues to have the cheapest gas in the state at $3.44 a gallon, up 4 cents from last week, with Galveston-Texas City close behind at $3.45 a gallon, an increase of 3 cents from last week.
The nationwide average for a gallon of gas is up 1 cent to $3.68.
“Since Gustav caused minimal damage or disruption to oil production, the price spike appears to be short-lived,” said AAA-Texas Houston spokeswoman Sarah Schimmer payday loan. “In many regions, we have seen prices start to inch down in the last couple of days,”
Samsung Electronics Co Ltd (005930.KS: Quote, Profile, Research, Stock Buzz), the world’s top maker of memory chips, said it may buy flash memory maker SanDisk (SNDK.O: Quote, Profile, Research, Stock Buzz), which is valued at $3.2 billion, in a deal that could reshape a struggling industry.
“We are looking at various opportunities regarding SanDisk, but nothing has been decided yet,” Samsung spokesman James Chung told Reuters in response to reports the South Korean firm was interested in the U.S. maker of flash memory, which is widely used in storage devices and digital gadgets.
In a regulatory filing later, Samsung said an acquisition of SanDisk was an option.
Analysts said an acquisition could shift the balance of power in the flash memory industry.
“Samsung buying SanDisk would mean big damage for Toshiba,” said Yoshihisa Toyosaki, head of IT research firm J-Star Inc paydayloans.com.
Shares in Samsung closed up 1.2 percent after gaining more than 3 percent, outperforming a 1.6 percent fall on the wider Seoul share market .
Stocks in Japan’s Toshiba (6502.T: Quote, Profile, Research, Stock Buzz), which trails Samsung in the flash market but which plans to nearly double its chip production capacity in partnership with SanDisk, fell 4.6 percent to their lowest since November 2005.
In a brief statement, SanDisk said it “periodically has conversations with multiple parties, including Samsung, regarding a variety of potential business opportunities,” but declined to comment further.
WGL Entertainment Holdings Inc. announced it has closed a broadcast license agreement with Zcom Networks Inc. on Sept. 4.
The agreement between Calabasas, Calif.-based Zcom and the Lake Mary-based TV production company will grant Zcom non-exclusive broadcast rights to all of WGL's programming, which includes the WGL Million Dollar Shoot Out.
Financial details of the transaction were not released.
The deal will also result in 15 million shares of Zcom's common stock being distributed to WGL shareholders cash advance. As of Oct. 1, all WGL shareholders will receive one share of Zcom stock for every 500 WGL shares owned.
WGL Entertainment Holdings Inc. (PINKSHEETS: WEHI) is a television production company. Zcom Networks Inc. (PINKSHEETS: ZCMN) is a media broadcasting and shopping network company that targeting early start-up telecom, media and technology companies.
A U.S. Securities and Exchange Commission plan to overhaul oil and gas reporting rules will boost oil companies’ proven reserves, lift their shares and may even lead to takeovers.
The SEC said in June it wanted to revise the rules, devised in the 1970s, saying they were based on “outdated” thinking.
The stockmarket regulator plans to allow companies to book reserves from “unconventional” oil and gas sources such as oil sands and coal-bed methane — currently two of the hottest areas of investment.
Companies would also be able to book reserves at some deep-water projects that cannot currently be described as “proven”, and firms could also publish data on “probable” and “possible” reserves, recovery of which is much less certain.
“The companies will actually be able to book more reserves,” said Frederic van Parijs, Senior investment manager with ING Investment Management in the Hague.
The planned reporting changes will not only apply to U.S payday loans in one hour. oil companies like Exxon Mobil (XOM.N: Quote, Profile, Research, Stock Buzz) but also European majors, as most report under SEC rules.
“For some companies, it would have a significant impact, particularly if they have a heavy exposure to non-traditional sources of future production,” said Peter Newman, who heads the oil and gas practice at Deloitte & Touche in London.
Individual companies declined to comment on the impact of the changes but support the SEC’s move strongly through industry bodies.
The Organization for Economic Cooperation and Development cut its forecast for U.K. economic growth to reflect the worst market for residential property in almost two decades.
The OECD projects growth will shrink between 0.3 percent and 1.2 percent in the third quarter from a year earlier, and contract 0.4 percent and 1.2 percent in the final three months of the year. The resulting 1.2 percent expansion in 2008 as a whole is lower than the 1.8 percent predicted in June.
The forecast came as the group said the world's leading central banks should leave interest rates at current levels to tame faster inflation while growth slows. The Bank of England will probably leave the key rate at 5 percent on Sept. 4, according to all 61 economists in a Bloomberg News survey.
“House prices exert crucial influences on U.K. activity,'' the OECD's acting chief economist Jorgen Elmeskov told reporters in Paris today. Growth in Britain “is going to more or less stagnate in the second half of the year, and we see that as generating enough slack in the economy eventually to bear down on inflation,'' he said in separate interview on Bloomberg Television guaranteed payday loans.
The central bank said yesterday U.K. mortgage approvals dropped to the lowest in nine years in July. A report last month from Nationwide Building Society showed house prices declined the most since 1990.
U.K. Prime Minister Gordon Brown today suspended a homebuyer tax and proposed spending 1 billion pounds ($1.8 billion) sooner than planned to help reverse the housing slump.
Surveys of purchasing managers in the manufacturing and construction industries published this week indicated growth is contracting, suggesting the economy is edging closer to a recession. U.K. expansion stagnated in the second quarter, ending the longest stretch of expansion in more than a century.
Russian manufacturing contracted in August for the first time in almost four years as businesses won fewer new orders and companies cut jobs.
VTB Bank Europe's Purchasing Managers' Index fell to 49.4 from 50.4 in July, the fifth consecutive monthly decline and the first contraction since November 2004, the bank said in an e- mailed statement today. A figure above 50 indicates growth. The bank surveyed 300 purchasing executives.
“The major factor underpinning the weakening in activity has been a decrease in new orders, which fell for the first time in almost 10 years,'' Dmitri Fedotkin, an economist at VTB Bank Europe Research, said in the statement.
Growth this year may miss the Economy Ministry's forecast of 7.8 percent as foreign investors pull money out and corporate borrowing costs rise as a result of international tension over Georgia, Alexander Morozov, chief economist at HSBC Bank in Moscow, said on Aug. 29. Industrial output rose an annual 3.2 percent in July, a slower pace than economists expected.
“With output requirements set to fall in light of the drop in new work received during the month, Russian manufacturers shed staff on average in August,'' the report said without giving details. The workforce shrank for the fourth consecutive month, it said.
Affecting Demand
New orders placed in August could have fallen because of a drop in the pace of wage growth and high inflation, at an annual rate of 14.7 in July.
“It may have got to the point where this is affecting demand,'' Fedotkin said by telephone from Moscow.
OAO GMK Norilsk Nickel, the world's largest producer of the metal, has said it may halve the 11,400 member workforce at one of its two largest Russian units to cut costs. Russia's biggest steelmaker, OAO Severstal, has also said it will eliminate as many as 3,000 jobs after costs climbed 23 percent last year.
“This could be a very negative indictor of the future trend,'' said Vladimir Tikhomirov, chief economist at UralSib Financial Corp. While there is a “broad consensus between government and the market'' that economic growth will slow this year, “new factors'' have emerged, he said.
“We've seen a correction on global energy and raw- materials markets, and we've also seen political problems, which have led to an outflow of short-term investment,'' Tikhomirov said cash advance loans. “This has put some investment projects on hold.''
GDP Contribution
Manufacturing accounted for 16.2 percent of gross domestic production in the first quarter, he said, compared with 18.3 percent for retail and wholesale trade, the largest contributor. The natural resources industry directly contributes 9.4 percent, though the industry indirectly drives 30 percent of the country's economic activity, Tikhomirov said.
Finance Minister Alexei Kudrin said on Aug. 17 that investors pulled $7 billion out the country between Aug. 8 and Aug. 11 after Russia's military incursion into Georgia.
The war was sparked by Georgian attempts to retake its breakaway province of South Ossetia, where most citizens have Russian passports. Russia sent troops, tanks and warplanes into the former Soviet republic before President Dmitry Medvedev ended military operations on Aug. 12. He subsequently recognized the independence of South Ossetia and Abkhazia, another separatist region, a step that angered the U.S. and Europe.
EU Summit
EU leaders are holding an emergency summit in Brussels today to consider a joint response to Russia's recognition of the two regions. Their options are limited, as Europe gets a quarter of its natural gas from Russia, and some leaders have played down the threat of sanctions.
Still, businesses in the PMI survey said costs eased in August even as transport, energy and metals prices rose.
“Input price inflation slowed more sharply than in any period in the 11-year survey history,'' the report said.
The cost of goods leaving factories and mines surged an annual 33.7 percent in July, the fastest pace in 3 1/2 years, led by fuel and coking coal prices, the Federal Statistics Service said on Aug. 21.
The PMI is derived from indexes which measure changes in output, orders, employment, suppliers' delivery times and stocks, according to VTB.
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