Mortgage Rates Jump After A Red-Hot Jobs Report

[CLICK HERE JOIN OUR LIVE TRADING & TRAINING SESSIONS]( Hello investor, Mortgage Rates Jump After A Red-Hot Jobs Report Buying homes just became even more expensive, as the average rate on the popular 30-year fixed mortgage jumped to 7.22% yesterday, according to Mortgage News Daily. That was the highest rate since early November. What happened? ADP released its employment report yesterday, and companies added two times more jobs than the expectations. Rates were already rising when Fed Chair Jerome Powell insisted that there could be two more rate hikes. But Wall Street has started to believe Powell more after the blowout employment data. The 2-year U.S. Treasury yield soared to hit a 16-year high yesterday. (Source: Mortgage News Daily) This likely makes current homeowners even more reluctant to sell their homes. Many of them locked into rock-bottom rates (under 4%) during the pandemic and selling a home would mean taking on even higher rates nowadays. - “Recent data indicated that nearly 82% of home shoppers reported feeling locked-in by their existing low-rate mortgage, while around 1 in 7 homeowners without a selling plan cited their current low rate as their reason for remaining on the sidelines,” Jiayi Xu, an economist at Realtor.com, said in a release. Sure enough, year-to-date new listings plummeted by 20% from last year’s pace. There is a shortage of available homes to buy, so homebuilders have been seizing the moment to build new inventories to meet demand. A 95% chance: After the recent economic data, traders are now pricing in about 95% chance of a hike during the central bank’s meeting later this month, according to CME Group’s FedWatch tool. - “The market clearly would have preferred an in-line number,” said John Lynch, chief investment officer at Comerica Wealth Management. “But because it was more than double expectations, that really ratchets up the fear factor that the Fed would have to be more aggressive.” Job openings fell more than expected in May, according to a Labor Department report. This could be a sign that the job market could be cooling down just a little bit. But some analysts doubt that it would be enough for the Fed to ease up. - “This was very, very strong hiring data. The moderation in some of the wage data was encouraging for the Fed, but there is nothing in here that would make them hesitant to hike at the end of the month,” said Ben Jeffery, a US rates strategist at BMO Capital Markets.  Buy This “Forever” Stock And Hold For A Decade Today’s Stock Pick: Accenture Plc ([ACN]() Accenture is as solid as any stock pick you can make. It is one of the world's largest IT service companies with IT professionals (based in 50 countries) offering a wide range of services to approximately 7,000 clients across 120 countries. Most of those clients are Fortune 500 and Fortune 1000 companies. (Photo: Alamy) Two words to describe Accenture: steady grower. Between 2016 and 2022, Accenture's annual revenue rose at a compound annual growth rate (CAGR) of 10%. Obviously, it is not a dizzying growth. But it’s all about shareholder returns. Its annual free cash flow doubled in five years – going from $4.1 billion in 2016 to $8.4 billion in 2021. (Source: Accenture) We chose this stock for a reason. It’s all about cash flow in the next few years. With rising interest rates, even tech companies can’t get away with massive growth. Investors want to see cold, hard cash. And Accenture generates plenty of them. Excellent revenue growth: Accenture plays in five key industries – (1) communications, media, and tech, (2) financial services, (3) health and public services, (4) products, and (5) resources. In the table below, you’ll see that Accenture posted solid growth in all segments except for Communications, Media & Technology: (Source: Accenture) The growth came from Accenture’s focus on high-growth segments like cloud, interactive, security, and digital transformation. Earnings guidance: It would be business as usual for Accenture. It expects adjusted earnings growth for FY23 to be between 7% to 9%. Stable earnings and margins: The company’s margin is very solid, with the guidance forecasting its margin at about 14.1%. That’s good guidance for a safe company like Accenture that returns a lot of cash to shareholders. Shareholder returns: Accenture loves to reward shareholders through dividends and share repurchases. Dividends grew 10% CAGR over three years, and share repurchases jumped by 15% three-year CAGR. (Source: Accenture) Your current dividend yield would be about 1.46%, and that would grow bigger if you hold the stock for a decade. You can easily see as high as 10% return from dividends alone. Bottom line: Nearly every major corporation is looking to digitalize its operations. Go digital or die. Therefore, Accenture plays in a hot industry, and its business stability offers you a safe annual return. It is not an exciting stock, but you can count on a double-digit percentage return per year.   [CLICK HERE JOIN OUR LIVE TRADING & TRAINING SESSIONS](     © All Rights Reserved, Trade Alliance  If you no longer want to receive these messages, you may [click here]( to unsubscribe.