The past week has had a lot of news for consumers, investors, and businesses. This week we discuss mortgage rates, Disney and streaming prices, stock markets and funds, and some confusing news from the Labor Department. Let’s dive in!
Disney Prices
Disney has had a wild few years, including massive box-office hits such as Avengers End Game and Deadpool & Wolverine, while also acquiring Fox, and launching Disney+. While there have been huge wins for the company, costs have skyrocketed, and the company has struggled with its profits. Today, Disney Stock (DIS) is down 26.44% over the last 5 years.
However, today, Disney has moved into good territory for the company, as it is reporting a profit for the first time in a while. So why does this matter to you? For one, if you’re an investor, the stocks are up 3.52% over the last 5 days. But more importantly, as we’ve known for a while now, Disney looks to continue to raise their prices. After Disney announced that there will be a new fast pass for their parks costing consumers upwards of $400/person, we will also be seeing some increases in Disney+ starting today, October 17th. prices will increase between $1 and $2 depending on the plan. Disney is not alone, as analysts also assume that we will see price increases for other streaming services like Netflix.
Mortgage Rates Continue to Rise
On September 18th, the Federal Reserve announced rate cuts by 1/2 (0.5) percentage points. On September 19th, an average 30-year mortgage rate was at 6.09% for the week. The next week, we saw mortgage rates drop to 6.08%, but ever since, the mortgage rates have gone up.
Today, we are seeing more increases in mortgage rates, at 6.44% for a 30-year mortgage, the highest since August 22nd. Some say that the economy is strengthening, and that’s why the mortgage rates are increasing, but there are still some questions about the strength of the economy right now. While consumers are looking for a break in buying new homes, they will have to continue to wait until there is momentum with interest rate drops. The Federal Reserve is expected to cut rates twice more this year, and when that happens, the housing market should be more affordable, or at least easier to dive into.
Finding Stability in the Stock Market
Many stocks have thrown investors on a roller coaster ride these past few months. Stocks like Tesla (-11.51% over the past year; +39.96% over 6 months) and Apple (+29.97% over the past year) have investors looking for growth stocks stumped. However, ETFs and mutual funds continue to perform well, even in an unstable market. Let’s take a look at a few examples:
Vanguard S&P 500 (VOO)
VOO has been a favorite of many over the past couple of years as it has grown in popularity. But this popularity has some substance behind it. Currently trading at $537.43 at the time of writing, VOO is up 16.14% over the past six months.
Fidelity 500 Index (FXAIX)
FXAIX was created in 2011, and since that date has grown over 325%. Over the past 6 months, the fund has increased 15.70%. The last year looks even better at a 33.66% increase.
Timing the market while buying low and selling high sounds great, but it is nearly impossible. While we do not necessarily recommend the above funds, it does make sense to do some research into some ETFs or mutual funds. These funds offer diversity and expert analysis while leaving the stress of having to know when to buy and sell off of your shoulders. Ultimately, it is up to you to decide what you are going to do for your investments. Consider doing your research, buying and holding, and avoid timing the market.
More Confusing Labor Statistics
U.S. Bureau of Labor Statistics released a minor report on job openings and turnover summary. We saw little movement in job openings, as 6 states reported job opening increases in August, while 2 states decreased job openings. Hiring dropped in 6 states and increased in 1 state, and the rest of the states and Washington DC saw little change.
Overall, the news is not that exciting, but it is rather telling about our labor market. Over the past two months, we’ve been told the labor market is weak, then strong, then weak again. Today, the news confirms everything we’ve heard: the labor market is the same as it has been all year, which is on the weaker side.
The markets are not stable (and usually aren’t), but there are options out there. During this uncertain time of economics and the job market, make sure you have a strong budget to keep your finances stable. We have resources on financial literacy and career sources for those who need it.
