May 23rd, 2017
Overview: A lone suicide bomber killed 22 and injured 59 overnight in at a concert in Manchester, U.K. ISIS has taken responsibility for the horrific attack. One person has been apprehended in connection with the bombing, while the bomber has yet to be identified. The attack occurred at an Ariana Grande concert where many children were present.
After hitting a near 10-year high in March, New Home Sales in April fell to an annual rate of 569,000, below the 605,000 expected and below the 642,000 in March, which was revised from 621,000. From April 2016 to April 2017, sales were up just 0.5%. The decline in sales was due in part to rising building material costs along with a lack of lots and a shortage in labor. Inventories are running at a 5.7 month supply, just below the six-month supply that is considered healthy.
Luxury home builder Toll Brothers reported on Tuesday that it sold more homes and said orders surged 26% in its quarterly earnings report. As of April 30, Toll Brothers sold 1,638 in the latest quarter, up from 1,304 in the previous quarter. The average price to purchase a new Toll Brothers home fell to $832,400 from $855,500 a year earlier, which was due in part to lower priced homes geared towards millennials. A spokesperson for the builder said it was the best spring selling season in over 10 years.
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.
|Commentary at the close: MBS edged lower today influenced by modestly higher Stock prices and as traders continued to take some profits along with this week's added Treasury supply. Weak New Home Sales couldn't lift Bond prices. The Fannie Mae 30-yr 3.5% coupon lost 16bp to end at 102.81. Stocks ended higher following President's Trump'sd budget plan highlights. The Dow rose 43.08 points to 20,937.91, the S&P gained 4.40 points to 2,398.42 while the NASDAQ saw a small gain of 5.09 points to end at 6,138.71. WTI oil selltled at $51.47/barrel, +$0.34. 10-yr yield 2.28%. April Existing Home Sales will be released tomorrow. The Treasury will sell $34B 5-yr Notes. The Fed minutes from the May 3 meeting will be released tomorrow at 2:00 p.m. ET.|
|Tue, May 23 3:52 PM Heading into the close, Stocks holding onto modest gains.|
|Tue, May 23 2:47 PM Alert To Lock!|
|Tue, May 23 2:44 PM Stocks edge higher as investors assess President Trump's budget plan.|
|Tue, May 23 1:14 PM The $26B 2-yr Note auction garners an "A-" rating.|
|Tue, May 23 12:56 PM MBS at session lows ahead of the auction results.|
|Tue, May 23 12:45 PM $26B 2-yr Note auction results at 1:00 p.m. ET.|
|Tue, May 23 12:40 PM There is a a rumor out that German finmin Wolfgang Schauble and the IMF have reached a compromise on Greek debt forgiveness.|
|Tue, May 23 11:45 AM Highlights of the new budget plan from the Trump administration pushes MBS a bit lower. Stocks push higher.|
|Tue, May 23 10:32 AM Fed's Kashkari says soft inflation readings are concerning.|
|Tue, May 23 10:31 AM Once again today, not much movement seen in MBS as they hug the flat line.|
|Tue, May 23 10:03 AM New Home Sales in April 569K annualized units vs 605K expected. March revised to 642K vs 621K.|
9:49 AM ET 3.5% Fannie Mae 30-yr coupon up 3 bp at a price of 103.00 up 9 bp when rates were set yesterday at 10:00 am Open 103.03 High 103.06 Low 103.00
Numbers to watch for:
102.44 50 day moving average the market considers a buying opportunity
102.71 25 day moving average the market now considers a buying opportunity.
103.00 Traders keep there eye on round numbers and this is one them with lots of zeros
103.33 200 day moving average the market considers a selling opportunit
|Tue, May 23 9:34 AM Stocks trade modestly higher soon after the opening bell on Wall Street.|
|Tue, May 23 8:14 AM April New Home sales will be released at 10, 605K annualized units expected.|
|Tue, May 23 8:11 AM The 10-yr yield unchanged at 2.24% ahead of the first of this week's Treasury auction's with $26B 2-yr Notes being offered today, results at 1:00 p.m. ET.|
|Tue, May 23 8:07 AM MBS open near unchanged.|
|Tue, May 23 8:07 AM Trump's budget plan looks to cut government spending by $3.6T over the next decade.|
|Tue, May 23 8:02 AM Fed Governor Lael Brainard said last night that the U.S. economy may not yet be at full employment.|
|Tue, May 23 8:02 AM MBS look to open near unchanged as S&P futures push higher ahead of Trump's budget plan which is aimed at cutting government spending.|
|Tue, May 23 7:57 AM A lone suicide bomber kills 22 and injures 59 in at a concert in Manchester, U.K. in the ISIS related terrorist attack.|
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.