Here's your Daily Commentary report compliments of Jeff Drew and Star Mortgage!
Thursday’s bond market has opened in negative territory following early stock gains. The stock markets are showing strength during early trading with the Dow up 135 points and the Nasdaq up 30 points. The bond market is currently down 11/32, which will likely push this morning’s mortgage rates higher by approximately .250 of a discount point.
This morning’s early data came from the Labor Deportment who reported that 554,000 new claims for unemployment benefits were filed last week. This was a sizable increase from the previous week, which is good news for bonds and mortgage rates. However, this figure was close to analysts’ forecasts and since this data is not considered highly important, its impact on this morning’s mortgage rates has been minimal.
The National Association of Realtors gave us June’s Existing Home Sales report. They showed an increase of 3.6% in home resales last month. This was slightly higher than expected, but it was not enough of a variance to influence this morning’s bond trading or mortgage rates.
Neither of today’s economic releases have enough influence to lead to this morning’s stock strength and bond weakness. I suspect the selling in bonds is much more of a result of the stock gains as investors sell bond holding and shift funds into stocks. Whether this is temporary or a trend is yet to be seen. But I am staying on the cautious side towards mortgage rates as it appears there is more room for bonds to fall, at least short-term.
Tomorrow’s only relevant economic data is the final revision to July’s University of Michigan Index of Consumer Sentiment that will help us measure consumer optimism about their own financial situations. This is important because rising consumer confidence means that consumers may be apt to make large purchases in the near future. This adds fuel to the economic recovery and is looked at as bad news for bonds. It is an update to the preliminary reading we saw two weeks ago, so unless we see a drastic revision to the preliminary estimate, I think the markets will probably shrug this news off.
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...
©Mortgage Commentary 2009
* Please note that this information reflects just one opinion on the current market. If you have a mortgage rate and monthly payment you are comfortable with you may want to consider locking that rate. It is very difficult to predict the market in these very volatile times. Most lenders have a mortgage rate renegotiation policy. See testimonials. Call me 800-941-5616 or email me with questions: jeff@starmortgage.com
Subscribe to:
Post Comments (Atom)
No comments:
Post a Comment