August 31st, 2016
What Is Going On With Interest Rates? #wigowir
When the price of Mortgage Backed Securities (MBS) on the Chart above goes down rates go up, and when the price goes up rates come down. Chart was posted at 10:10 am. All times are Eastern Standard.
MBS end narrowly changed as markets turn attention towards Friday's Non-farm Payrolls. Traders were not eager to add any new positions. The month end saw the Dow snap a 6-month winning streak, the S&P snapped a 5-month winning streak while the Nasdaq saw a 0.99% gain for August. The 3% Fannie Mae 30-yr coupon closed near unchanged at 103.69. The Dow lost 53.42 points to 18,400.88, the S&P 500 fell 5.17 points to 2,170.95, while the Nasdaq was lower by 9.77 points to end at 5,213.21. WTI oil was last seen at $44.81/barrel, -$1.54. 10-yr T Note yield 1.57%. Weekly Initial Jobless Claims, Q2 Productivity and the ISM Index will be released tomorrow morning.
Commentary 10:10 am - as you can see on the above chart that we are trading above the 25 & 50 day moving averages. With ADP in line we now prepare for the Employment Report that comes out on Friday at 8:30 am. This report can create volatile movements in the market as traders digest the information, shore up their positions and leave early for the holiday weekend. For this reason we will expect the unexpected.
Feel free to call (205-266-5669) or email (firstname.lastname@example.org) John for a quote based on the terms of you loan.
8:15 AM ET New Rates have been posted
30-Year Fixed 3.375% (3.457% APR) No Origination Fee
15-Year Fixed 2.750% (2.892% APR) No Origination Fee
7-1 ARM 30 year 3.000% (3.341% APR) No Origination Fee
For more rates and details click: http://www.johnmarbury.com/page5.html/
Below is the news when it happened and the market’s reaction. All Times are Eastern Standard Time.
2:52 PM - Lower oil prices weigh on the Stock markets as energy shares push lower.
Freddie Mac reported further improvement in the housing market in June as measured by the Multi-Indicator Marker Index (MiMi). The index rose 0.08% to 85 compared to a 1.06% increase in May. It was the slowest month-over-month gain since January 2015.
2:16 PM - Fed Fund Futures show a 27% chance of a hike to the Fed Funds Rate at the September meeting.
1:09 PM - At midday, MBS flat to higher, Stocks well into negative territory.
12:38 PM - Dow -100 points.
12:38 PM - WTI oil -$1.57 to $44.79/barrel.
12:34 PM - MBS near session highs though the gains are limited as Stocks add to losses.
10:52 AM - The S&P pushes further into negative territory, -7.34 points.
10:36 AM - MBA: the average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $417K) increased to 3.63% from 3.62%, with points decreasing to 0.27 from 0.35 (including the origination fee) for 80% loan-to-value ratio (LTV) loans.
10:34 AM - MBA: the average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($417K or less) remained unchanged at 3.67%, with points decreasing to 0.33 from 0.34 (including the origination fee) for 80% loan-to-value ratio (LTV) loans.
10:05 AM - July Pending Home Sales +1.3% vs the 0.7% expected.
9:35 AM - Stocks open modestly lower. Dow -33 points.
9:07 AM - July ADP revised higher to 194K from 179K.
8:38 AM - WTI oil $45.89/barrel, -$0.47.
8:26 AM - Chicago PMI (9:45) and Pending Home Sales (10).
The MBAs Market Composite Index, a measure of total mortgage application volume, rose 2.8% in the latest week.
S&P futures unchanged after ADP, 10-yr yield unchanged.
Not much reaction to the near in line ADP data.
8:15 AM - ADP reports 177K private payrolls vs 170K expected.
8:13 AM - Estimates call for 170K private payrolls in August.
10-yr T Note yield 1.58%.
S&P futures, MBS near unchanged ahead of the 8:15 release of the August ADP Private Payrolls data.