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Wednesday's bond market has opened in negative ground with no relevant economic news scheduled for release and the stock markets showing early gains. The Dow is currently up 131 points while the Nasdaq has gained 25 points. The 10 year Treasury Yield is back up to 2.95... rates are going to be slightly higher today than yesterday... partially due to big volume in locking in loans on Tuesday and also due to the Markets.
The stock markets opened strong yesterday also, but actually fell into negative ground during the day before closing with respectable gains. If the major stock indexes repeat that cycle, particularly closing well below current levels, we may see improvements in bonds this afternoon. Since it is an especially light week with no relevant data, Home loan rates are subject to the cause and effect of the DOW.
However, the flip side of that scenario is if stocks extend this morning's gains rather than retreat from their current levels. If the major stock indexes move higher, bonds could move lower later today. This would likely lead to an upward revision to mortgage rates this afternoon, but would probably be a minor adjustment.
The Labor Department will post weekly unemployment figures early tomorrow morning. This release usually has little influence on bond trading or mortgage rates, but with a lack of important data scheduled for release this week it may draw more attention than usual. Analysts are expecting to see that approximately 460,000 new claims for benefits were filed last week. The higher the total of new claims, the better the news for bonds and mortgage rates.
As I have pointed out, the markets are jittery and you should be Taking charge of this low rate environment! Call us for a free loan evaluation.
Some source information from www.mortgagecommentary.com and Kent Friend
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