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On Monday, September 5, 2011, in observance of
Labor Day!
On Friday September 2, 2011
Our office will be open regular hours.
Have a safe and happy holiday!
Thank you for your continued business and support.
Wednesday, August 31, 2011
Mortgage Rate Update
Anthony Hood
Equity Investment Capital
Office: 949-891-0067
Email: tony@equityinvestmentcapital.com
website: www.equityinvestmentcapital.com
Building Strong, Lasting Relationships; One Client at a Time.
Wednesday, August 31, 2011
At 8:15 the August ADP private jobs report showed an increase of 91K; markets were generally expecting an increase of 100K, in the world of jobs it is considered right on estimates given the revisions that will come later. The stock market trade remained with gains while the treasury and mortgage markets also held slight price gains after yesterday's strong rate market rally. Over the previous six reports, ADP’s initial figure was closest to the Labor Department’s first estimate of private payrolls in February, when it understated the gain in jobs by 5,000. The estimate was least accurate in June, when it overestimated the increase in employment by 100,000.
The weekly MBA applications out at 7:00; the overall index declined 9.6%. Refinancing applications fell 12.2% in the August 26 week according to MBA. The purchase index ended three weeks of heavy decline though with only a mild 0.9% gain. Rates are near 10-month lows, at 4.32% for 30-year lows for a seven basis point decline in the week. Points for 30-year loans increased to 1.30 from 0.88 (including origination fee) for 80% loans.
At 9:30 the DJIA opened up 53 points, the 10 yr note dipped back from its best levels (+9/32) to +4/32 at 2.17%. Mortgage prices at 9:15 were +8/32 (.25 bp) at 9:30 +3/32 (.09 bp).
At 9:45 the August Chicago purchasing mgrs index, expected at 54 frm 58.8, it was better at 56.5. The components; new orders index fell to 56.9 frm 59.4 in July, prices pd index fell to 68.6 frm 71.7 and employment increased a little to 52.1 frm 51.5. On the initial reaction toe 10 yr fell to -1/32 on the day with its rate at 2.18%, earlier this morning the rate was at 2.14%; mortgage prices held their prices at 9:30 (+.09 bp).
At 10:00 July factory orders; expectations were for an increase of 2.0%, as released orders increased 2.4%; June revised from -0.8% to -0.4%. Ex transportation orders up 0.9%. A better report along with a better Chicago report added to the gains in stock markets and pushed rate market prices lower.
The rate markets are continuing to move in a range, the 10 yr note still looking good but at present levels and uncertainty about what the President will announce in his speech next week the bond and mortgage markets will likely continue to trade in a narrow range. The Fed is also in play; yesterday's FOMC minutes revealed a Fed divided on what to do, if anything. Bernanke says the Fed has many tools in its box to use if necessary. What does that mean? The division at the FOMC on what to do is the most since back in 2002 when Greenspan was in charge. There is no consensus at the Fed and certainly no consensus in the markets. Bernanke wants to jam rates so low that it will force banks to lend and drive investors into stocks, all n an effort to induce consumers to spend more. The problem is, consumers are more wise than the Fed and markets give them credit for; savings rate is at 5.0% after negative savings prior to 2008. As long as job creation remains weak and home prices continue to decline consumers will not increase spending.
Anthony Hood
Equity Investment Capital
Office: 949-891-0067
Email: tony@equityinvestmentcapital.com
website: www.equityinvestmentcapital.com
Building Strong, Lasting Relationships; One Client at a Time.
Wednesday, August 31, 2011
At 8:15 the August ADP private jobs report showed an increase of 91K; markets were generally expecting an increase of 100K, in the world of jobs it is considered right on estimates given the revisions that will come later. The stock market trade remained with gains while the treasury and mortgage markets also held slight price gains after yesterday's strong rate market rally. Over the previous six reports, ADP’s initial figure was closest to the Labor Department’s first estimate of private payrolls in February, when it understated the gain in jobs by 5,000. The estimate was least accurate in June, when it overestimated the increase in employment by 100,000.
The weekly MBA applications out at 7:00; the overall index declined 9.6%. Refinancing applications fell 12.2% in the August 26 week according to MBA. The purchase index ended three weeks of heavy decline though with only a mild 0.9% gain. Rates are near 10-month lows, at 4.32% for 30-year lows for a seven basis point decline in the week. Points for 30-year loans increased to 1.30 from 0.88 (including origination fee) for 80% loans.
At 9:30 the DJIA opened up 53 points, the 10 yr note dipped back from its best levels (+9/32) to +4/32 at 2.17%. Mortgage prices at 9:15 were +8/32 (.25 bp) at 9:30 +3/32 (.09 bp).
At 9:45 the August Chicago purchasing mgrs index, expected at 54 frm 58.8, it was better at 56.5. The components; new orders index fell to 56.9 frm 59.4 in July, prices pd index fell to 68.6 frm 71.7 and employment increased a little to 52.1 frm 51.5. On the initial reaction toe 10 yr fell to -1/32 on the day with its rate at 2.18%, earlier this morning the rate was at 2.14%; mortgage prices held their prices at 9:30 (+.09 bp).
At 10:00 July factory orders; expectations were for an increase of 2.0%, as released orders increased 2.4%; June revised from -0.8% to -0.4%. Ex transportation orders up 0.9%. A better report along with a better Chicago report added to the gains in stock markets and pushed rate market prices lower.
The rate markets are continuing to move in a range, the 10 yr note still looking good but at present levels and uncertainty about what the President will announce in his speech next week the bond and mortgage markets will likely continue to trade in a narrow range. The Fed is also in play; yesterday's FOMC minutes revealed a Fed divided on what to do, if anything. Bernanke says the Fed has many tools in its box to use if necessary. What does that mean? The division at the FOMC on what to do is the most since back in 2002 when Greenspan was in charge. There is no consensus at the Fed and certainly no consensus in the markets. Bernanke wants to jam rates so low that it will force banks to lend and drive investors into stocks, all n an effort to induce consumers to spend more. The problem is, consumers are more wise than the Fed and markets give them credit for; savings rate is at 5.0% after negative savings prior to 2008. As long as job creation remains weak and home prices continue to decline consumers will not increase spending.
Tuesday, August 30, 2011
Mortgage Rates
Anthony Hood
Equity Investment Capital
Office: 949-891-0067
Email: tony@equityinvestmentcapital.com
website: www.equityinvestmentcapital.com
Building Strong, Lasting Relationships; One Client at a Time.
Tuesday, August 30, 2011
A better open this morning in the bond and mortgage markets; the stock indexes pointing to a lower open. Two days of stock market rallies generally leads to a day of decline as investors are still unwilling to jump in heavily. On the bond and mortgage markets, the rate markets are likely to continue their sideway movement until at least Friday when the August employment report is released. The MBS market continues to be volatile with price changes as much as 7/32 a click at times; this morning 30 yr MBSs traded +11/32 (.34 bp), in one trade the price fell 7/32 (.22 bp).
Charles Evans, Chicago Fed President, on CNBC this morning suggesting the Fed should be doing much more; he mentioned the Fed should increase its inflation target to 3.0% in an effort to reflate prices, he suggests he would like to see more stimulus, he wants the Fed to set a target for low rates possibly tied to employment like until the unemployment rate falls to 7.5% as an example. He isn't one in the camp that believes there will be no double dip; another Fed voice and another opinion. At 2:00 this afternoon the Fed will release the minutes of the FOMC meeting on 8/9 wherein there was a lot of dissention within the members debating the economic outlook and led up to the famous "the Fed will leave rates at these levels until mid-2013". The minutes should be interesting, if not market moving. Evans does not believe the Fed's low rates has inflated commodity prices; on that comment gold jumped $40.00.
June Case/Shiller home price index at 9:00 am; Q2 overall +3.6%; in June up 1.1%. It covers 20 cities, a lot of data that essentially doesn't have much new news in it. The index of property values in 20 cities fell 4.5% from June 2010, after a 4.6% drop in the 12 months ended May that was the biggest since 2009.
At 9:30 the DJIA opened -50; mortgage prices that were +11/32 at 9:00 fell back to +4/32 at 9:30. The 10 yr note up 19/32 at 9:30 at 2.20% -6 bp. MBSs are looking weaker than what we expect, low volume and the Case/Shiller data this morning might be a drag. Prior to 9:30 the stock indexes were trading much weaker than at the actual open.
At 10:00 August consumer confidence; expected at 52.0 frm 59.5, fell to 44.5; the expectations index fell to 51.9 frm 74.9 and the jobs-hard-to-get index at 49.1 frm 44.8 in July. The reaction was swift; the 10 yr note jumped to +27/32 to 2.17%, mortgage prices no change on the data; the DJIA down 107. Just prior to the release the DJIA -27, the 10 yr note +23/32 and mortgage prices up 10/32 (.31 bp)
Bonds and mortgages are likely to continue sideway movement until Friday's employment data. After employment its the President and his next major speech on the 5th of Sept where he will reveal what plans he has to boost the economy, the housing markets and employment.
Anthony Hood
Equity Investment Capital
Office: 949-891-0067
Email: tony@equityinvestmentcapital.com
website: www.equityinvestmentcapital.com
Building Strong, Lasting Relationships; One Client at a Time.
Tuesday, August 30, 2011
A better open this morning in the bond and mortgage markets; the stock indexes pointing to a lower open. Two days of stock market rallies generally leads to a day of decline as investors are still unwilling to jump in heavily. On the bond and mortgage markets, the rate markets are likely to continue their sideway movement until at least Friday when the August employment report is released. The MBS market continues to be volatile with price changes as much as 7/32 a click at times; this morning 30 yr MBSs traded +11/32 (.34 bp), in one trade the price fell 7/32 (.22 bp).
Charles Evans, Chicago Fed President, on CNBC this morning suggesting the Fed should be doing much more; he mentioned the Fed should increase its inflation target to 3.0% in an effort to reflate prices, he suggests he would like to see more stimulus, he wants the Fed to set a target for low rates possibly tied to employment like until the unemployment rate falls to 7.5% as an example. He isn't one in the camp that believes there will be no double dip; another Fed voice and another opinion. At 2:00 this afternoon the Fed will release the minutes of the FOMC meeting on 8/9 wherein there was a lot of dissention within the members debating the economic outlook and led up to the famous "the Fed will leave rates at these levels until mid-2013". The minutes should be interesting, if not market moving. Evans does not believe the Fed's low rates has inflated commodity prices; on that comment gold jumped $40.00.
June Case/Shiller home price index at 9:00 am; Q2 overall +3.6%; in June up 1.1%. It covers 20 cities, a lot of data that essentially doesn't have much new news in it. The index of property values in 20 cities fell 4.5% from June 2010, after a 4.6% drop in the 12 months ended May that was the biggest since 2009.
At 9:30 the DJIA opened -50; mortgage prices that were +11/32 at 9:00 fell back to +4/32 at 9:30. The 10 yr note up 19/32 at 9:30 at 2.20% -6 bp. MBSs are looking weaker than what we expect, low volume and the Case/Shiller data this morning might be a drag. Prior to 9:30 the stock indexes were trading much weaker than at the actual open.
At 10:00 August consumer confidence; expected at 52.0 frm 59.5, fell to 44.5; the expectations index fell to 51.9 frm 74.9 and the jobs-hard-to-get index at 49.1 frm 44.8 in July. The reaction was swift; the 10 yr note jumped to +27/32 to 2.17%, mortgage prices no change on the data; the DJIA down 107. Just prior to the release the DJIA -27, the 10 yr note +23/32 and mortgage prices up 10/32 (.31 bp)
Bonds and mortgages are likely to continue sideway movement until Friday's employment data. After employment its the President and his next major speech on the 5th of Sept where he will reveal what plans he has to boost the economy, the housing markets and employment.
Monday, August 29, 2011
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