December 13th, 2016
Commentary: MBS closed mixed in price as the market positions itself for the Fed's interest rate decision at 2pm ET tomorrow
WRAP: Higher Stock prices weighed on the Bond markets today sending prices lower, but Mortgage Bonds did manage to close above the lows. The Fannie Mae 30-yr 3.5% coupon closed unchanged at 102.19, right near support at 102.22. Stocks closed at record highs as the Dow closes in on the 20K milestone. The S&P gained 14.76 points to 2,271.72, the Dow was up 114.78 points to 19,911.21, while the Nasdaq rose 51.28 points to end at 5,463.82. WTI oil closed at $52.98/barrel, +$0.15. 10-yr T Note yield 2.47%. Economic data tomorrow includes PPI and Retail Sales. The Fed's monetary policy statement will be released at 2:00 p.m. ET tomorrow.
|Date & Time of Report||Report||For||Estimate||Actual||Prior||Impact|
|12/14/2016 8:30:00||Core Producer Price Index (PPI)||Nov||0.20%||-0.20%||Moderate|
|Producer Price Index (PPI)||Nov||0.30%||0.80%||High|
|Retail Sales ex-autos||Nov||0.40%||0.80%||High|
|12/14/2016 14:00:00||FOMC Meeting||Dec||NA||NA||High|
What Is Going On With Interest Rates? #wigowir
Below is the news when it happened and the market’s reaction. For a full view of the day start at the bottom and work your way up. If want to know what just happened start at the top. All Times are Eastern Standard Time. When the price of Mortgage Backed Securities (MBS) goes down rates go up, and when the price goes up rates come down. Remember in the bond market Bad News is Good News and Good News is Bad news.
1:12 PM The $12B 30-yr Bond auction garners a "B+" rating and completes this week's Note and Bond offerings.
12:17 PM Alert To Lock!
12:02 PM MBS now at session lows as the 3.5% Fannie Mae 30-yr coupon falls below support.
11:34 AM A report from Black Knight Financial Services showed that there are now 3.3 million borrowers in the eligible to refinance pool, which means that 5 million borrowers lost the incentive to refinance since the election when rates began to rise.
11:22 AM Fannie Mae and Freddie Mac will suspend foreclosure evictions during the holidays starting on December 19, 2016 to January 3, 2017.
10:29 AM Stocks off best levels.
10:27 AM The NFIB Small Business Optimism Index rises in November. The survey said, "The outlook for business conditions jumped sharply following the U.S. presidential election."
Tue, Dec 13 10:10 AM
MBS push lower now near unchanged levels.
Tue, Dec 13 9:43 AM
Stocks open higher - Dow +111 as it draws closer to 20,000, now at 19,905.
Tue, Dec 13 8:35 AM
CoreLogic reports there were 30,000 completed foreclosures nationally in October, down from 40,000 in October 2015, a 25% decline.
8:22 AM U.S. dollar index 101.14, +0.09.
8:21 AM The Treasury will sell $12B 30-yr Bonds today, results at 1:00 p.m. ET.
8:19 AM WTI oil near unchanged at $52.97/barrel.
8:14 AM There are no economic reports due for release today.
8:14 AM The 2-day FOMC meeting kicks off today on Capitol Hill where it is expected that the Fed will raise the short-term Fed Funds Rate by 0.25%.
8:12 AM The Fannie Mae 30-yr 3.5% coupon opens above support two (S2) at the multi-year low of 102.22, now at 102.31.
8:09 AM The yield on the 10-yr T Note is at 2.45%, up from the 1.71% seen in the early morning hours following the election. Yesterday's high was 2.52%.
8:08 AM Bond prices edge higher as investors continue to seek out bargain prices with higher yields.
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