Daily market commentary

Greetings! Here's your Daily Commentary report compliments of Alan Russell & Princeton Capital! Call me today for current rates and market information at (650) 947-2296.           Tuesday’s bond market has opened in positive territory again despite stronger than expected economic news. The stock markets are helping to boost bonds with early selling that has driven the Dow lower by 101 points and the Nasdaq down 42 points. The bond market is currently up 8/32, which should improve this morning’s mortgage rates by approximately .125 - .250 of a discount point. The Conference Board gave us today’s only economic data that was relevant to mortgage rates. They announced late this morning that their Consumer Confidence Index (CCI) for August rose to 81.5 when analysts were expecting to see 77.0 that would have been a decline. What this means is that surveyed consumers were more optimistic about their own financial situations than they were last month. Since that usually translates into higher levels of consumer spending, we should consider the data negative for the bond market and mortgage pricing. Fortunately, other factors are driving trading today that has allowed for this morning’s improvements. Helping to push bond prices higher and mortgage rates lower (besides early stock weakness) is the crisis in Syria. Recent events there appear to mean that the U.S. and its allies will be more active than previously. This issue could have broader reaching complications in terms of other countries objecting to a move and possible global economic growth, which makes stocks less appealing to investors. As a result we are seeing some flight-to-safety where investors shift funds away from stocks and into bonds to escape the potential volatility that may follow. It is not on a large scale yet, but it has pushed the yield on the benchmark 10-year Treasury Note down to 2.75%. The longer it stays away from 2.90%, the more likelihood of it moving closer to 2.50% and fueling a downward trend in mortgage rates. There is no relevant economic data scheduled for release tomorrow, so expect to see this afternoon’s tone continue into tomorrow morning’s trading. If today’s early gains hold into closing, we should see a calm open in bonds tomorrow at the very least, with a decent chance of getting further improvements to mortgage rates. We do have the 5-year Treasury note to deal with tomorrow, but results won’t be posted until 1:00 PM ET. Therefore, we won’t see a reaction to it until early afternoon trading. If I were considering financing/refinancing a home, I would.... Lock if my closing was taking place within 7 days... Lock if my closing was taking place between 8 and 20 days... Float if my closing was taking place between 21 and 60 days... Float if my closing was taking place over 60 days from now...       Alan Russell 161 South San Antonio Rd. | Los Altos, CA 95022 Ph: 650-947-2296 | Fax: 408-335-1118 alanrussell@princetoncap.com CLICK HERE TO STOP RECEIVING OUR REPORT