Investors are showing great risk aversion as the biggest losers of the session are predominately in the high-flying biotechnology and semiconductor sectors. Growing concerns over another bubble has sent the NASDAQ and Russell 2000 lower from their 52-week highs. The US dollar remains strong and debt issues continue to plague Greece and the European Union, while oil inventories certainly aren’t helping either. For the week ended March 20^th, crude oil inventories increased by another 8.2 million barrels for the 11^th straight weekly build and yet another 80-year high. Refineries cut back production in the week, which resulted in a draw of 2.0 million barrels of gasoline inventories and no change for distillate inventories.

Though the market remains distressed, there continue to be some rays of positivity. Playing off of the pop in new home sales yesterday, there looks to be a turnaround in the volume of mortgage applications on a weekly basis. Low mortgage rates are finally leading to a rise in applications in the week ended March 20^th for both home purchasers (up 5.0% over last week) and home refinancers (up 12.0% over last week). Purchase applications are actually up 3.0% year-over-year and this is especially optimistic for gains in home sales. Mortgage rates moved lower in the week with the average 30-year loan for conforming balances (less than or equal to $417,000) sharply lower by 9 basis points to a rate of 3.9%.

On the flip side, it’s apparent that the manufacturing sector is still quite weak. For the month of February, durables orders declined by 1.4% in the month after rebounding by 2.0% in January, and fell short of market expectations for a 0.7% gain. However the core reading (excluding transportation orders) declined by 0.4% in the month following a 0.7% drop in January, but it still fell short of the consensus estimate for a 0.3% gain. In February, orders in transportation declined by 3.5% in the prior month; this after rebounding by 8.8% in January. Motor vehicle orders also slipped in February by 0.5%, while, nondefense aircraft orders dropped by 8.9%, and defense aircraft fell by a hefty 33.1%. Outside of the core, overall orders were mixed. Areas that showed improvement were primary metals and electric equipment, while declines were observed in fabricated metals, machinery, and computers & electronics. Nondefense capital goods orders excluding aircraft, which is about as core of a reading as one can get, dropped by 2.6% in February after an 8.8% increase in January. The number of total new orders in this reading (in the chart below) has been steadily on the decline since August 2014. Ultimately, the latest orders numbers points to more weakness in manufacturing and serves as one more data point for the Federal Reserve to keep rates low.