This morning we received a number of economic reports. Initial jobless claims last week rose 2,000 to 393,000. Durable goods orders were a mixed bag with November’s better than expected performance being offset by downward revisions to September. Personal income was up slightly while personal spending was softer than expected. The U.S. savings rate continues to steadily decline from its 2010 and 2011 highs, which is contributing to the increase in spending.
Germany received a wake up call today on a failed debt auction in which the German debt agency had to retain almost half of a 6 billion euro offering due to a shortage of bids. While the failed auction pushed 10 year yields in Germany to just slightly over 2%, well below its European brethren, it is a clear sign investors are shying away from Europe. European leaders have strongly opposing views on how to resolve the financial crisis, which for now tells investors there is no resolution.
In the U.S., stock markets are under pressure and broadly lower with yields on Treasuries flat from Tuesday’s close. Mortgage prices are worse by a few basis points.
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