During last week, chain store sales recouped 0.9% of the steep 1.2% fall of the prior period, according to the International Council of Shopping Centers (ICSC)-UBS.

The recovery moderated the decline for the full month of June to -0.2% versus the May average.

During the last ten years there has been a 59% correlation between y/y change in chain store sales and the change in non-auto retail sales less gasoline.

The ICSC-UBS retail chain-store sales index is constructed using the same-store sales reported by 78 stores of seven retailers: Dayton Hudson, Federated, Kmart, May, J.C. Penney, Sears and Wal-Mart.

The index of mortgage applications compiled by the Mortgage Bankers Association jumped 19.5% (-49.0% y/y) last week.

The rise may have been spurred by a decline in interest rates. The effective interest rate on a conventional 30-Year mortgage fell to 6.24% from 6.47% the week earlier. The effective rate on a 15-year mortgage also fell to 5.72%, down 24 basis points.

Applications to refinance mortgages led the gain with a 27.7% rise last week (-73.9% y/y).

Purchase applications jumped 15.0% (21.0% y/y) during the week. For the month purchase applications nevertheless fell 4.7% versus May.

During the last ten years there has been a 63% correlation between the y/y change in purchase applications and the change in new plus existing home sales.

The Mortgage Bankers Association surveys between 20 to 35 of the top lenders in the U.S. housing industry to derive its refinance, purchase and market indexes. The weekly survey accounts for more than 40% of all applications processed each week by mortgage lenders. Visit the Mortgage Bankers Association site here.