• Home
  • About
    • Our Advantage
    • Meet the Brokers
    • FAQ Using a Broker
  • Pre-Approval
    • Pre-Qualification Form
    • Loan Application
    • Documents Required for a Home Loan Mortgage
    • Credit >
      • Imperfect or Bad Credit Loans
      • Fico Score
      • Good Fico Score
      • How Fico Scores Work
      • Fico Scores Ignore
      • How Fico Scores Help
      • Fico Tips
  • Loan Types
    • What is an Arm?
    • Conventional Loan
    • FHA Loan
    • VA Loan >
      • VA Loan Eligibility
      • VA Refinance IRRL
    • HARP
    • Jumbo Loan
    • Hard Money Loans
    • Reverse Mortgage >
      • What Is A Reverse Mortgage
      • Benefits Of A Reverse Mortgage
      • Reverse Mortgage VS HELOC
      • Loan Process
      • Reverse Mortgage Presentations
      • Reverse Mortgage Quote
  • Buyers/Sellers/Homeowners
    • Refinance >
      • What Not To Do When Refinancing
    • First Steps in Homebuying >
      • Down Payment Strategies
      • Rent vs. Buy
      • 6 Benefits to Owning Your Own Home
    • After You Sign the Contract
    • The Loan Process
    • Mortgage Payment
    • FSBO
    • Preparing for an Open House
  • Blog
  • Support
    • Property Search
    • Property Tax Information
    • Mortgage Glossary
    • Mortgage FAQs
    • Useful Links
  • Contact
  • Reviews
Effective Mortgage Company
Follow Us

Effective Mortgage Company

Blogs on Mortgages, Markets And Other Items Of Interest. Stay Up To Date!

Blog

Market Update

7/17/2015

0 Comments

 
The bond and mortgage markets were looking good prior to 8:30 when two key reports hit. June housing starts and building permits were both stronger than expectations; starts were thought to have increased 7%, as reported up 9.8% to 1174K units. Permits were thought to be down 6.5%, as reported permits jumped a huge 7.4% to 1343K units. It was all about multi-family though, up 29.4%; single family starts actually declined 0.9%. Multi-family permits increased 15.3%, permits for single family increased 0.9%. Still a concern that people are more willing to stay as renters rather than purchase a home.

 June CPI data was right on consensus estimates; overall +0.3%, the core excluding food and energy +0.2%. Yr/yr core +1.8%. CPI does get attention but as have noted previously it isn’t where the Fed looks, the Fed is focused more on the personal consumption index that is reported with GDP data.

The IMF out saying Greece’s debt should be re-structured to help insure Greece’s economy has a better chance of recovery and be able to pay its debt. That isn’t going over well with Germany though. Re-structuring the debt may feed to other cash strapped countries ask for debt restructuring. Is this going to be the next battle to erupt in the EU? The EU and the common currency was an experiment that appears to be going badly for a number of the countries that signed up.

At 9:30 the DJIA opened down 51, NASDAQ +29, S&P unch. The 10 at 9:30 up 1 bp to 2.36%, 30 yr MBS price -5 bps frm yesterday’s close and +14 bps frm 9:30 yesterday. Tech stocks including bio-tech continue to climb refuting Yellen’s thought that a bubble may be forming.

At 10:00 the U. of Michigan consumer sentiment index, expected at 96.0 frm 96.1 at the end of June. The index declined to 93.3; it is a mid-month read, why markets look at the end of the month as the significant reading is questionable. The decline is a decline; that said, as you know we don’t put as much attention to the consumer readings---too emotional, rather look at what consumers are doing rather than what they think.

The Fed continue to believe inflation will begin to increase soon to its goal of 2.0%; yesterday Yellen reiterated that thought in her testimony to the Senate Banking Committee. She and most all Fed officials are ‘certain’ inflation is just around the corner, although 2.0% isn’t much. That goes against what markets are thinking now. Global growth has slowed and prices are more likely to decline than increase as long as growth remains tepid at best. Global commodity prices have been declining over the last two months; China’s economy slowing, Europe’s economies with the exception of Germany are struggling and here although our economy is improving it is a slow growth path. Janet Yellen on Wednesday and Thursday said falling commodity prices and a stronger dollar were temporary. “My colleagues and I continue to expect that, as the effects of these transitory factors dissipate and as the labor market improves further, inflation will move gradually back toward our two percent objective over the medium term,” she said. Looking at the 5 yr note and the 5 yr treasury inflation-protected note, it has declined to 1.577%, the lowest since the end of May. It suggests investors expect U.S. inflation to be running at 1.577% on an annualized basis on average within the next five years. It was 1.667% at the end of June and this year’s peak of 1.863% on April 23.

Still no break from our bearish technical work but equally no selling. The Fed wants to begin increasing rates this year, but remains cautious about the strength of the economy. Yellen commented yesterday she wants to move but isn’t sure the economy, employment and inflation data warrant a move based on current data. She completely believes the economy, employment and inflation will improve as the rest of the year unwinds.

  PRICES @ 10:10 AM

10 yr note:                   +3/32 (9 bp) 2.34% -1 bp

5 yr note:                     -2/32 (6 bp) 1.66% +1 bp

2 Yr note:                    -1/32 (3 bp) 0.67% +1 bp

30 yr bond:                  +24/32 (75 bp) 3.07% -4 bp

Libor Rates:                1 mo 0.188%; 3 mo 0.287%; 6 mo 0.455%; 1 yr 0.773%

30 yr FNMA 3.5 Aug:  @9:30 102.88 -5 bp (+14 bp frm 9:30 yesterday)

15 yr FNMA 3.0:         @9:30 103.35 -4 bp (+9 bp frm 9:30 yesterday)

30 yr GNMA 3.5:         @9:30 103.59 -8 bp (-10 bp frm 9:30 yesterday)

Dollar/Yen:                124.08 -0.09 yen

Dollar/Euro:              $1.0861 -$0.0014

Gold:                         $1135.70 -$8.20

Crude Oil:                 $50.96 +$0.05

DJIA:                        18,061.66 -58.59

NASDAQ:                  5195.36 +32.18

S&P 500:                  2123.27 -1.02

This Blog is for informational/advertisement purposes only and is not considered an offer to extend credit. Products are subject to change without notice. The information contained herein may not be applicable to every situation or jurisdiction, and we urge you to consult your professional advisor prior to acting on information contained herein. The content, accuracy and opinions expressed herein are not verified or endorsed by the sponsor hereof.
0 Comments



Leave a Reply.

    Categories

    All
    DIY
    FHA
    Holiday Tips
    Market Update
    Money Tips
    Monthly Newsletter
    Mortgage Knowledge
    Mortgage News
    Mortgage Programs
    Reverse Mortgage
    Seller Information
    VA

    Archives

    September 2021
    May 2021
    April 2021
    May 2020
    April 2020
    March 2020
    August 2018
    March 2018
    January 2017
    December 2016
    November 2016
    October 2016
    August 2016
    February 2016
    January 2016
    December 2015
    November 2015
    October 2015
    September 2015
    August 2015
    July 2015
    June 2015
    May 2015
    April 2015
    February 2015

    View my profile on LinkedIn

Our Services

Purchase Loans
Refinance Loans
Pre-approvals

Company

About Us
Contact Us
Our Blog

Support Page

FAQs
Mortgage Glossary
Mortgage Calculator
Property Tax Information
Credit Information
Useful Links
Property Search

Contact Us

Picture

Effective Mortgage Company BRE# 01264208 NMLS # 252973