Unemployment figures, mortgage cold feet and more: Friday's 5 things to know

Here are the key events taking place on Friday that could impact trading.

EARNINGS REPORTS CONTINUE: The first full week of third-quarter earnings wraps up Friday with a handful of big names.

Among the companies scheduled to report are consumer finance giant American Express, telecom and mass media powerhouse Verizon Communications, hospital operator HCA Healthcare and oil services firm Schlumberger -- all reporting before Friday’s opening bell.

In addition, Interpublic Group of Companies Inc., Huntington Bancshares Inc and Regions Financial group are all scheduled to release earnings.

THURSDAY MARKETS: U.S. stocks moved lower Thursday as investors weighed the latest batch of corporate earnings and the question of how aggressively central banks will raise interest rates to moderate inflation. 

Ticker	Security	Last	Change	Change %
AXP	AMERICAN EXPRESS CO.	231.04	+13.53	+6.22%
HCA	HCA HEALTHCARE INC.	305.19	+8.27	+2.79%
SLB	SLB NV	49.83	-1.10	-2.16%
IPG	INTERPUBLIC GROUP OF COS. INC.	30.75	+0.36	+1.18%
HBAN	HUNTINGTON BANCSHARES INC.	13.28	+0.10	+0.76%
RF	REGIONS FINANCIAL CORP.	18.91	-0.10	-0.53%

The S&P 500 fell 29.38 points, or 0.8%, to 3665.78 near the end of the trading day. The tech-focused Nasdaq Composite dropped 65.66 points, or 0.6%, to 10614.84 and the Dow Jones Industrial Average lost 90.22 points, or 0.3%, to 30333.59. 

Ticker	Security	Last	Change	Change %
I:DJI	DOW JONES AVERAGES	37986.4	+211.02	+0.56%
SP500	S&P 500	4967.23	-43.89	-0.88%
I:COMP	NASDAQ COMPOSITE INDEX	15282.009722	-319.49	-2.05%

Major central banks are expected to further lift interest rates during coming meetings as price pressures show little signs of easing. 

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Inflation figures in the U.K. and Canada came in above expectations this week. 

Germany's producer prices rose strongly in September from a year earlier, driven by higher energy prices, the German statistics office Destatis said Thursday. 

The Federal Reserve has raised interest rates five times this year and is likely to increase its benchmark federal-funds rate by another 0.75 percentage point at its meeting next month as it tries to bring down high inflation. 

"At the moment, we keep getting upside surprises on inflation everywhere you look," said Hugh Gimber, a strategist at J.P. Morgan Asset Management. "No one really has a good grasp yet of where the central banks -- particularly the Fed -- are going to be able to stop." 

UNEMPLOYMENT FIGURES OUT: Labor Department data showed 214,000 workers filed for unemployment benefits in the week ended Oct. 15, down from the week prior. 

Continuing claims, or the number of Americans who are consecutively receiving unemployment aid, rose to 1.385 million, up by 21,000 from the previous week's revised level. One year ago, more than 3.27 million Americans were receiving unemployment benefits.

The strong jobs data comes as the Federal Reserve tries to crush runaway inflation with the most aggressive rate hikes in decades. 

Policymakers have already approved five straight rate increases and have signaled that more hikes are to come as they try to cool the economy, and the labor market. 

INFLATION SURGED MORE THAN EXPECTED IN SEPTEMBER AS PRICES REMAIN PAINFULLY HIGH

Economic projections released by the Fed in September show that most officials expect unemployment to climb to 4.4% by the end of next year, up from the current rate of 3.7%. That is significantly higher than June when policymakers saw the jobless rate inching up to 3.7%.

Chair Jerome Powell conceded during the post-meeting press conference that higher rates could "give rise to increases in unemployment." 

"We think we need to have softer labor market conditions," Powell said. "And if we want to set ourselves up really light the way to another period of a very strong labor market, we have got to get inflation behind us. I wish there were a painless way to do that. There isn't."


BUYERS COLD FEET: Red-hot mortgage rates are giving home buyers and sellers cold feet. About 17% of homes that went under contract with real estate brokerage Redfin last month were called off. 

The technology-powered real estate firm reported that approximately 60,000 deals fell through in September, marking the "highest share on record aside from March 2020," the same month the World Health Organization declared the coronavirus pandemic. 

Redfin Economics Research Lead Chen Zhao said the housing market is at "another standstill" although it's completely different from the early days of the pandemic. 

"Demand is slumping due to surging mortgage rates, but prices are being propped up by inflation and a drop in the number of people putting their homes up for sale," Zhao said. 

MORTGAGE RATES EDGE HIGHER

It's forcing many to stay put especially if they locked in "a rock-bottom mortgage rate during the pandemic," he added. As a result, deals are falling through and buyer completion is waning, according to Redfin.

Freddie Mac reported Thursday that the 30-year fixed-rate mortgage averaged 6.94%. A year ago the rate was 3.09%. These rates have driven monthly housing payments for buyers up more than 50% compared to a year ago, according to Redfin.

The number of home sales dropped 25% in September compared to a year ago, according to the residential real estate brokerage. New Listings also plunged 22%, which marked the largest drop since May 2020.

CHARGED UP: The Biden administration awarded $2.8 billion this week to 20 companies after they pledged to honor Democratic goals like diversity, equity and inclusion as they hire people to build batteries and related components to be used in electric vehicles.

The conditional grants are the latest attempt by the Biden administration to push its diversity, equity, inclusion and accessibility (DEIA) agenda into the private sector.

Last month, DEIA leaders from several agencies met and agreed to extend their efforts in this area "across the federal government and our society."

It is also part of a broader trend of companies following environment, social and governance (ESG) principles as a way of earning a "responsible" brand among investors.

On Wednesday, President Biden and Energy Secretary Jennifer Granholm announced the $2.8 billion "investment" in EV battery companies and said explicitly that their decision to provide federal funding for these projects was conditioned on a promise to advance the DEIA agenda.

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"The companies submitted plans for engagement with local stakeholders, Tribal nations, environmental groups, and labor unions to ensure the funded projects create high-quality jobs; advance diversity, equity, inclusion, and accessibility; and contribute meaningfully to the Justice40 initiative to provide 40% of the overall benefits of federal clean energy investments to disadvantaged and underrepresented communities," the Department of Energy said.

Of the 20 companies that won awards, five said they would boost production in "disadvantaged communities," and 13 agreed to negotiate workforce and community agreements aimed at engagement with "host communities, labor unions and/or Tribal entities to agree on community benefits and implementation plans."

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Fifteen of the companies said they would collaborate with "minority serving institutions, including Historically Black Colleges and Universities (HBCUs) to hire and train workers."