Here's your Daily Commentary report compliments of Jeff Drew and Star Mortgage!
Friday’s bond market has opened in negative territory with little to drive trading. The stock markets are showing minor gains with the Dow up 36 points and the Nasdaq up 3 points. The bond market is currently down 7/32, but we will likely see little change in this morning’s mortgage rates due to strength late yesterday.
There is no relevant economic news scheduled for release today. Look for the stock markets to be the biggest influence on any swings in bond trading or mortgage rates this afternoon. As long as the stock markets remain fairly calm, mortgage rates will likely follow suit. However, this may be difficult because today is known as Quadruple Witching day in the stock markets. This is where stock index futures and options, stock options and individual stock futures all expire. As those options are executed throughout the day, it is common to see wide fluctuations in stocks. If the major stock indexes show sizable losses, bonds may benefit. If the indexes move higher, extending their recent rally, we could see changes to mortgage rates this afternoon.
Next week is fairly active in terms of economic releases and related events. There is a moderately important report being posted Monday morning that may slightly impact mortgage rates if it varies from forecasts. August’s Leading Economic Indicators will be released late Monday morning. It attempts to predict future economic activity over the next three to six months. It is expected to show a 0.7% increase, meaning that economic activity will likely rise fairly rapidly in the coming months. A smaller than expected reading would be considered good news for bonds and mortgage rates.
The rest of the week is also pretty busy. There is not an abundance of economic reports scheduled for release, but we do have another FOMC meeting and a couple of relevant Treasury auctions on the calendar that may affect mortgage pricing. Look for more 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... 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 are considering a purchase or refinance and have a mortgage rate and monthly payment you are comfortable with you may want to consider locking that mortgage rate. It is very difficult to predict the market in these very volatile times. Most lenders have a mortgage rate renegotiation policy. Contact me for details. Jeff@StarMortgage.com
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