Wednesday

April 19th, 2017

Commentary at the close: The seesaw trading pattern continued today as Mortgage Bonds dropped on Monday, rallied yesterday only to give back most of the gains today. There were no economic reports to impact trading today, but with prices at 2017 highs, sellers took hold of the market to secure profits. The Fannie Mae 30-yr 3-5% coupon fell by 22bp to end at 103.03. The Dow lost 118.79 points to 20,404.49, as IBM weighed. The S&P declined by 4.02 points to 2,338.17, while the NASDAQ squeaked out a 13.53 point gain to end at 5,863.03. WTI oil closed at $50.44/barrel, -$1.97. 10-yr T Note yield edged higher to 2.21%. Tomorrow's economic data includes Weekly Initial Jobless Claims and the Philly Fed Index.

 

 

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.

4:08 PM MBS give back most of yesterday's gains. The 3.5% 30-yr Fannie Mae 30-yr coupon falls below resistance at 103.12.
3:45 PM MBS lower despite big buying in Fannie/Freddie 3.5% and 4% coupons earlier in the session.
3:43 PM Dow down 136 points.
2:35 PM Fed's Beige Book says inflation pressures remained in check.
2:26 PM Oil prices dropping after data showed a smaller-than-expected decline in overall crude inventories along with another rise in production.
2:05 PM Fed's Beige Book: economy growing in all 12 districts and growing at a modest to moderate pace. Employment is expanding nationwide. Labor markets remain tight, wages rising.
1:10 PM At midday, MBS near session lows and haven't moved much in the past hour. Dow lower as IBM weighs, S&P slightly higher, NASDAQ holding decent gains.
12:38 PM Fed's Rosengren did say that balance sheet reductions should be gradual.
12:30 PM Fed's Rosengren says reduce balance sheet relatively soon and continue hikes as balance sheet declines.
10:56 AM Weak earnings for IBM drives shares lower, weighs on the Dow. The Dow is -30 points, S&P and NASDAQ higher.
10:29 AM Fresh session lows for MBS. We reiterate our locking stance.
10:17 AM MBS at session lows.
9:35 AM S&P opens modestly higher.
8:47 AM Fed Fund Futures are pricing in a 44% chance of a hike to the Fed Funds Rate in June, down from 60%.
8:26 AM The FHA 30-yr fixed mortgage rate fell to 4.09% from 4.14%.
8:24 AM The MBA also reported that the 30-yr fixed conforming mortgage rate fell to 4.22% from 4.28%, while 30-yr jumbo rates declined 9bp to 4.15%.
8:22 AM The MBAs purchase index fell 3.4%, due in part to the Passover and Easter holidays last week. The refinance index was essentially unchanged.
8:21 AM Despite mortgage rates at their lowest level since November 2016, the MBAs Market Composite Index, a measure of total application volume, fell 1.8% in the latest week.
8:20 AM U.S. dollar index 99.53, +0.13.
8:19 AM WTI oil at $52.42/barrel, unchanged.
8:18 AM 10-yr yield 2.20% from yesterday's close of 2.17%.
8:15 AM There are no major economic reports due for release today. The Fed's Beige Book will be released at 2:00 p.m. ET.
8:14 AM IBM reported a bigger-than-expected decline in revenues for the first time in five quarters.
8:12 AM Overall profits of S&P 500 companies are estimated to have risen nearly 11% in the latest quarter, the best since 2011.
8:10 AM Morgan Stanley reported a surge in quarterly profit, shares are up 2% in premarket trading.
8:07 AM Let's go back the other way! MBS open lower, S&P futures higher as markets seesaw this week influenced by earnings, geopolitical news and economic 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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