263K private jobs created in March, well above the 175K expected

April 5th, 2017

Commentary at the close: Stocks and Bonds traded is seesaw fashion today influenced by ADP, ISM and the Fed minutes. The strong ADP numbers sent Mortgage Bond prices lower, the weaker-than-expected ISM Service Index boosted prices somewhat, while the high Stock valuation words from the Fed minutes reversed Stocks lower and boosted Bond prices. The Bond closed up 6bp to end at 102.62 and traded as high as 102.72 and as low as 102.34. The Dow was up 200 points before the Fed minutes but closed down 41.09 points to 20,648.15, the S&P 500 fell by 7.21 points to 2,352.95, while the NASDAQ closed lower by 34.14 to 5,864.47. WTI oil closed near unchanged at $51.15/barrel, but closed in negative territory in afterhours trading. 10-yr T Note yield 2.34%.Economic data tomorrow is limited to Weekly Initial Jobless Claims. Looking ahead we have the first Friday of the month (Non-Farm Payrolls) coming up and if you are interested find more go to the following site: https://www.johnmarbury.com/blog/8964/what-report-creates-the-most-potential-for-volatility

 

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.

At the Close 3.5% Fannie Mae 30-yr coupon up  6 bp at a price of 102.62 up  16 bp when rates were set today at 10:00 am Open 102.56 High 102.72 Low 102.34

4:31 PM Stocks reverse and end in negative territory after the Fed minutes revealed that it may shrink its balance sheet by the end of 2017. In addition, the Fed minutes also said that some members are worried over high Stock evaluations

3:37 PM  3.5% Fannie Mae 30-yr coupon up 13  bp at a price of 102.69 up 22 bp when rates were set today at 10:00 am Open 102.56 High 102.69 Low 102.34 (Watch out for R2 $102.72)

3:25 PM Stocks lose gains as the S&P and the Dow turn negative.
3:14 PM MBS bounce back to session highs. Alert to lock was a knee jerk reaction.  We are just providing the data.
2:05 PM Fed's balance sheet reduction text sends Bond prices lower. Alert To Lock!
2:03 PM Fed minutes reveal that most members support balance sheet reduction in 2017
12:25 PM MBS trade near unchanged in a tight range after the strong ADP data and ahead of the 2:00 p.m. release of the Fed minutes.
10:54 AM MBS trade back to unchanged levels.
10:46 AM The New York Fed purchased $1.228B in Fannie/Freddie 30-yr 3.5% and 4% coupons this morning and has pushed prices off the earlier lows.
10:23 AM Dow now up nearly 200 points, but MBS trade near unchanged.
10:02 AM The March ISM Service Index 55.2 vs 57.0 expected and down from 57.6 in February.
9:42 AM The Dow is up 100 points soon after the open.

9:00 AM  3.5% Fannie Mae 30-yr coupon down 6  bp at a price of 102.50 down 9 bp when rates were set yesterday at 10:00 am Open 102.56 High 102.59 Low 102.44

8:36 AM The meeting between President Trump and China's President Xi will begin on Thursday.
8:31 AM MBA reports that the 30-yr fixed conforming mortgage rate 4.34%, essentially unchanged. FHA 30-yr 4.15%, down 9bp. Jumbo 30-yr 4.24%, essentially unchanged.
8:25 AM The MBA reports that its Market Composite Index, a measure of total mortgage loan application volume, fell 1.6% in the latest week.
8:25 AM The MBAs refinance index -4.2%. The purchase index +0.7%. Purchase loan size reached a survey high of $318,200.
8:18 AM MBS edge lower after the better-than-expected ADP data.
8:17 AM February ADP data revised lower to 245K from 298K.
8:15 AM ADP reports that there were 263K private jobs created in March, well above the 175K expected.
8:13 AM WTI oil $51.61/barrel, +$0.58.
8:13 AM U.S. dollar index 100.36, near unchanged.
8:11 AM The minutes from the March 15 Fed meeting will be released at 2:00 p.m. ET and could offer clues as to the future path of interest rates.
8:09 AM The 10-yr T Note yield 2.35%, unchanged.
8:04 AM MBS open near unchanged ahead the 8:15 a.m. ET release of the March ADP Private Payrolls data.

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. On October 5th we started posting our rates and leaving them on the site for you to refer back to. This will allow  you see where actual rates have been along with the news that caused the fluctuations on the rate sheet.  I ask that you forgive my spelling and grammatical mistakes. This is due writing skills that are lacking and the need to communicate quickly.  Most of the information posted on this blog along with the charts and indexes are available all during the day to the subscrbers of www.themortgagemarketguide.com  The cost of subscription is very reasonable.

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