15-year home loans drop to record lows
The 15-year mortgage rate fell last week to a new low of 2.36%, spurring more refinancing of home loans.
Applications to refinance a home loan jumped 9% last week from the previous week, according to the Mortgage Bankers Association's seasonally adjusted index.
The MBA said the average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances fell to 3.01% from 3.11%, with points decreasing to 0.34 from 0.43 (including the origination fee) for loans with a 20% down payment. That is the lowest rate for 30-year mortgages since February.
The decline in mortgage rates follows the drop in the 10-year Treasury yield last week.
"Investors grew concerned about increasing Covid-19 case counts and the downside risks to the current economic recovery," said Joel Kan, MBA's associate vice president of economist and industry forecasting.
Ford sales, profits outpace forecasts
Sky-high sales prices for its pickup trucks and SUVs helped Ford Motor Co. turn a surprise second-quarter profit despite a global shortage of computer chips that cut factory output in half.
The Dearborn, Michigan, company said Wednesday that it made $561 million from April through June, largely because of cost cuts and higher-than-expected prices for its vehicles.
The automaker warned earlier in the year that it would be hit especially hard by the chip shortage and a fire at Japanese supplier Renesas that manufactures many of its automotive-grade chips, resulting in a second-quarter loss.
But Ford surprised investors by earning 13 cents per share excluding one-time items. That was far better than Wall Street expectations of a 3-cent-per-share loss, according to FactSet.
Revenue was $26.8 billion, also above analysts' forecasts of just over $23 billion.
Facebook profits double in quarter
Facebook doubled its profit in the second quarter thanks to a massive increase in advertising revenue, especially the average price of the ads it delivers to its nearly 3 billion users. But the company said it doesn't expect revenue to continue to grow at such a breakneck pace in the second half of the year.
The Menlo Park, California-based company earned $10.39 billion, or $3.61 per share, in the April-June period. That's up from $5.18 billion, or $1.80 per share, a year earlier.
Revenue jumped 56% to $28.58 billion from $18.32 billion. Analysts, on average, were expecting earnings of $3.04 per share and revenue of $24.85 billion, according to a poll by FactSet.
Advertising revenue growth was driven by a 47% year-over-year increase in the average price per ad and a 6% increase in the number of ads shown to people. Facebook said it expects ad prices, not the amount of ads it delivers, to continue to drive growth.
Boeing report profit first time since 2019
Boeing reported its first quarterly profit since 2019 and its revenue topped expectations as the giant aircraft maker tries to dig out from the most difficult stretch in its history.
Boeing earned $567 million in the second quarter, compared with a $2.4 billion loss a year ago.
Industry analysts had expected a sizeable loss. Boeing Co. shares ended regular trading up 4% on Wednesday.
The return of the troubled 737 Max jet after two deadly crashes is key to Boeing's rebound. The company delivered 79 commercial planes in the quarter — including 47 Maxes — compared with 20 a year earlier. Deliveries are an important source of cash for Boeing because that's when airlines usually pay the bulk of the price for a new plane.
Still, Boeing's core commercial-planes business lost money. That was offset, however, by profits in its defense and space unit and its services division.
Boeing cut thousands of jobs over the past year and a half as it dealt with the grounding of its 737 Max airliner and the pandemic, which cut airlines' demand for new planes. Boeing planned to reduce its workforce to 130,000 from 161,000 at the end of 2019. However, CEO David Calhoun said in a memo to employees Wednesday that the business is stabilizing and the company now plans to stop cutting and keep jobs at the current level of about 140,000.
— Compiled by Dave Flessner