|
Friday’s bond market has opened sharply lower following much stronger
than expected employment news. The stock markets are surprisingly having
a subdued reaction to the same data with the Dow up 9 points and the
Nasdaq up 24 points. The bond market is currently down 34/32, which will
likely push this morning’s mortgage rates higher by somewhere between .500
and .750 of a discount point.
The Labor Department gave us this morning’s big news with the release of
October’s employment statistics. They announced early this morning that
the unemployment rate moved up to 7.3% as it was expected to. That
actually could be considered good news for bonds and mortgage rates, but
the payroll numbers made it irrelevant. Today’s report showed that
204,000 new jobs were added to the economy last month, doubling forecasts
of around 100,000. The data and statements that are part of the report
indicate that the government shutdown had little impact on the numbers.
In addition, upward revisions to September’s and August’s payroll numbers
added 60,000 jobs over the two months.
204,000 jobs is not an overwhelmingly strong number for the long-term
economic outlook. However, if comparing to what the markets were
expecting, it sure looks like a strong number and the markets are trading
accordingly. The yield on the benchmark 10-year Treasury Note is
currently at 2.74%, just above that important threshold referenced
earlier in the week. If it doesn’t fall below 2.72% almost immediately, I
believe there is a good chance of it moving higher very soon. Since
mortgage rates tend to follow bond yields, this would translate into even
higher rates than we are seeing today.
September's Personal Income and Outlays report was also posted early this
morning, revealing a 0.5% increase in income and a 0.2% increase in
spending. The income reading was much higher than the 0.2% that was
forecasted, meaning consumers had more money to spend than many had
thought. That is a negative for the bond market and mortgage rates.
However, the spending portion of the report matched forecasts, making the
data slightly negative for the bond and mortgage markets. Although, this
data has had little impact on today’s trading or pricing due to the
importance of and the surprise in the employment data.
The University of Michigan posted their Index of Consumer Sentiment for
November just before 10:00 AM ET this morning, showing a reading of 72.0.
This was much weaker than the 75.3 that was expected and more importantly
a decline from October’s 73.2. That indicates consumer confidence in
their own financial and employment situations was softer than analysts
were expecting to see, making it favorable news for the bond market and
mortgage rates. Maybe if it came on another day we could have been happy
about it. With today’s employment news, the markets have had no interest
in this report and it has done little to derail the bond selling.
Next week doesn’t have any key economic data scheduled for release but
does have a couple minor reports set to be posted in addition to a couple
Treasury auctions. The bond market will be closed Monday in observance of
the Veteran’s Day holiday with no early close today. The stock markets
will be open for trading and I suspect that many lenders will be open for
business although they will likely use today’s pricing or won’t accept
new rate locks. Look for details on next week’s events in Sunday’s weekly
preview.
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... Lock if my closing was taking place
between 21 and 60 days... Lock if my closing was taking place over 60
days from now...
|
12 month installment payday loans doesn’t come with time-consuming loan formalities of fax, credit check, extensive paperwork and any other documentation. Thus, lenders approve these loans quickly to you and transfer funds straightaway in your bank account in a very less time.
ReplyDeleteinstallment payday loans online bad credit
bad credit installment loans online
500 Loan Over 3 Months
To sum up, Home Loans for People with Bad Credit are easy and affordable loan schemes which give you comforts along with cash. Getting such timely monetary aids is the best way to meet all your sudden expenses without any hassle, Please visit
ReplyDeleteCheap Loans For People With Bad Credit
Secured loans for people with bad credit history
Internet Home Loans.
This is really a nice blog which provides a new perspective about the industry. I too have something worth sharing about electric radiators uk
ReplyDeleteNice Blog. Thank you for sharing such a great informative blog. I also want to share a bit of information about guaranteedloansforunemployed.
ReplyDelete