Jobs Report tomorrow

November 2nd, 2017

Suggestions that can change during the day: Mortgage Bond prices are modestly higher ahead of tomorrow's closely watched jobs report. Short-term locking is recommended.

After close Commentary: Not much movement in MBS today ahead of tomorrow's Jobs Report for October where it is expected that 300K new positions were created. The benchmark Fannie Mae 30-yr 3.5% coupon closed at 102.84, +6bp, above resistance at the 200-day Moving Average. Stocks ended mixed. The Dow ended with an 81.25 gain closing at a record high of 23,516.26, the S&P closed near unchanged at 2,579.85, while the NASDAQ ended with a small loss of 1.59 points ending at 6,714.94. WTI oil settled at $54.54/barrel, +$0.24. 10-yr yield slipped to 2.34%. President Trump nominated Fed Governor Jerome Powell for the next Fed Chair. The widely anticipated Jobs Report for October will be released at 8:30 a.m. ET tomorrow and always carries big headline risk. Be sure to be tuned in around 8:30 for the numbers and the market reaction.

Late morning Commentary:   The Republicans introduced their tax bill to the House of Representatives this morning seeking up to $6 trillion in tax cuts over the next 10-years. Some of the details have been released. The corporate tax rate will go from 35% to 20% and will be permanent. The tax plan would maintain state and local deductions for mortgage interest for existing loans and newly purchased homes will be capped at $500K versus the current $1 million. The child tax credit will go to $1,600 from $1,000.

The Fed released its monetary policy statement yesterday without much fanfare. The Fed left the benchmark Fed Funds Rate unchanged at 1.25% and left the door open for a December hike. The Fed said the labor market has continued to strengthen and that economic activity has been rising at a solid rate despite hurricane-related disruptions. The Fed went on to say that inflation measures have declined this year and continue to run below 2%. The Fed will most likely hike at the December meeting. Fed Funds Futures show a near 100% chance of a hike next month.

Online shopping is expected to hit record highs this season with a big portion coming from mobile shopping. It is expected that online sales will hit a record $107.4 billion, up from $94.4 billion in 2016. Mobile shopping is expected to account for 34% of that $107.4 billion. Cyber Monday is expected to be the biggest online shopping day in history, with $6.6 billion in online sales, up 16.5% from last year.

Johnmarbury.com has attempted to verify the information contained on this post.  However any aspect of such may change without notice.  Johnmarbury.com does not provide investment advice and does not represent that any of the information or related analysis is accurate or complete at any time. Forgive my spelling and grammatical mistakes due to writing skills that are lacking and the need to communicate quickly.  

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