Market commentary

Weaker than expected Consumer Spending data helped push bond prices higher this morning, after the steep Thursday sell off. Consumer spending accounts for 70% of the US economy, so although Personal Income rose and inflation remains tame, stocks are taking a breather. Mortgage bonds are improved by .125% to .25%.

The bond market is closing early today if front of the long Memorial Day weekend; therefore, HSOA’s lock desk will close at 12 noon, Pacific Time.

Enjoy your long weekend!!

Market commentary

We knew this day would come; the day the bond markets unwound as stress subsides regarding the prospect for European bond defaults. Bond prices in the US are dropping hard, driving interest rates higher. The price on the 10 year note has fallen over 1.00%, causing the yield to spike to 3.33%.

The big news driving this was the commitment by China to their European investments, stating China is a long term investor in Europe.

The US economic data had little effect on the markets. GDP for the first quarter was revised lower to 3.00%, and first time claims for unemployment fell 14,000 last week.

So, the glass half full---mortgage rates remain well below 5.00%, for now.

Market commentary

The volatile trading patterns of the past couple of weeks continue today, however, this morning it is not positive for the US bond market. Stocks are rebounding and the flight to quality bid is rapidly disappearing from US treasuries. The decline in treasury prices may be exacerbated later today as the US government auctions $40 billion of 5 year notes.

Mortgage pricing is approximately .125% worse from Tuesday.

Market commentary

Stock futures are tumbling this morning as concerns grow regarding the tension between South and North Korea, and news from Spain that regulators are urging banks to merge with stronger partners to help ease investor concerns.

The US Treasury begins this week’s auctions with the 2 year note today, followed by 5 year and 7 year note auctions Wednesday and Thursday. Interestingly US treasuries are not seeing the significant flight to quality this morning given the steep decline in stocks. Mortgages are approximately .125% better in price.

Market commentary

This week is full of economic data inclusive of new and existing home sales, durable goods orders, and GDP. Again, all of this U.S. data will be overshadowed by events in Europe and resolution to their debt problems.

Friday we saw bond yields rise, with mortgage pricing ending the day about .50% worse, as U.S. stocks rebounded. This morning the opposite is true as we see bond prices improving and stocks lower. It appears low mortgage rates will be with us for at least another day.

Market commentary

A new term was offered as a description of the recent market activity; de-risking. In laymen’s terms that means investors are selling stocks and commodities in which profits have been accumulated, and of course this bring into focus the margin call issue. As prices fall, investors that purchased stocks and commodities with borrowed funds either have to come up with additional cash, or need to sell their positions to meet the margin call. This has the effect of driving prices even lower.

This morning, after a steep, early sell-off in futures, the US stock markets have found support, as many investors feel the there are now value opportunities. Bond prices are will off the best levels of the day, so if you have a loan closing within the next 30 to 45 days, you should take the opportunity to lock a great rate today. Remember, HSOA is offering a great purchase special!

Have a great weekend!

Market commentary

Today’s comments will sound like a broker record, but again today the U.S. markets are trading on the uncertainty in European markets. The DOW is lower over 200 points and the 10 year note is higher in price by over 1 point. Interest rates on mortgage loans have fallen back to 4.50% and 4.625% for 30 year fixed rate loans.

Again, the reason for this is the uncertainty in the European markets. Any perceived resolutions to this situation will cause a quick and steep reversal.

Market commentary

U.S. stock and bond markets have almost completely diverged from positive economic data releases and earnings announcements, in favor of focusing on developments in Europe. Tuesday’s late afternoon selling in US stocks and buying of treasuries was driven by Germany’s unilateral ban on naked short selling of German bunds and certain company stocks. This move left investors wondering if German and other European banks were facing struggles.

In addition to the European problems, the US Senate is debating the new financial regulatory bill, which is creating significant uncertainty on how this will affect US financial institutions. You folks need to pay attention to this, because this bill will make it even more difficult for consumers to obtain credit, especially mortgage financing. And it creates another mammoth government entity to regulate non-bank financial institutions. So how does one pay for a new government entity? Well, by imposing fees and new taxes, of course. So, between the state governments and the federal government, you can expect the mortgage lending landscape to change significantly---unless you contact your Senators and declare your views.

Market commentary

Friday we saw a nice rebound in bond prices, and this has continued into Monday morning, although not as dramatic. The markets remain concerned about the events in Europe and this is causing continued volatility in both stock and bond markets.

This week has a full economic calendar including data on inflation. While the data is important, Europe will be the over-riding concern. This is reflected in the overnight libor rate, which is creeping higher—indicating banks are becoming more reluctant to lend to each other.

Market commentary

US bond prices ended in positive territory yesterday, which was good news considering the tepid demand at the 30 year bond auction. US economic data the past few weeks has generally showed improvement and growth in the economy. In a “normal” environment the result of this would be rising interest rates and an improving stock market, however, the tenuous economic situation in Europe has global investors nervous. The result of this has been extreme volatility in global stock and bond markets, and a general flight to quality bid for US treasury debt.

Today, the US bond market is again the beneficiary of nervous investors. Mortgage bonds have improved .25% to .375%, offering borrowers another great opportunity to lock in a great interest rate!

Have a great weekend!

Market commentary

Initial jobless claims fell this last week for the fourth straight week, indicating the US labor market is beginning to thaw. However, as we saw from last Friday’s employment data more folks are now deciding to re-enter the work force, which is what drove the unemployment rate higher.

In Europe, the new austerity measures, another way of saying “living within your means”, are raising concerns economic growth will falter. The sentiment regarding how stable the Euro zone is seems to change daily, and today, the feeling is negative. This is actually good news for us as we see US treasury bonds trading at higher prices, pulling mortgage bonds along for the ride. Pricing today is .125% to .25% better than Wednesday.

Market commentary

It seems the market euphoria caused by the European bailout package has subsided in favor of a reality check. As details are released investors are poking holes in the plan and many now view the bailout as a short-term solution, perhaps only delaying the inevitable. The result in the US markets is flat trading in both stock and bonds, with gold at $1216/oz, nearing an all time high.

Today the US Treasury is auctioning $38 billion of 3 year notes, which will be followed by $24 billion of 10 year notes on Wednesday and $16 billion of 30 year notes on Thursday. You should expect volatility to continue.

Market commentary

As expected, last week’ turbulence in the global bond and stock markets brought a wake-up call to the European Central Bank. Over the weekend the governing council of the ECB along with the International Monetary Fund and the Group of 8 (the largest global economic powers) decided on a “stabilization plan”, meaning the ECB will be buying sovereign and private bonds in the open market. This is the same strategy the Federal Reserve used and is being implemented today.

This plan and the accompanying actions, coupled with Friday’s strong employment data have had the desired effect on the markets. The Euro currency is rallying, global stock markets are skyrocketing, and bonds, especially U.S. Treasuries are swooning. The yield on the 10 year note has risen .15% to 3.55%, and mortgage rates are rising as well. The good news is that so far today mortgage bonds are performing better than treasuries, so don’t let this opportunity to lock at a low interest rate slip away!

Market commentary

The Labor Department reported the U.S. economy added 290,000 jobs in April, and the March increase was revised upward to 230,000. The unemployment rate, however, rose from 9.7% to 9.9%. Expectations had been for new job creation of 180,000 to 190,000, so the surprise to the upside immediately drove bond price lower, prices higher.

As anticipated, the markets have shrugged off the employment data, continuing to focus on the situation in Europe. This is good news for us as prices for mortgages are slightly better than Thursday. Enjoy another opportunity to lock your borrowers at very low interest rates.

Have a great weekend, and do not forget Mother’s Day!!

Market commentary

Bond and stock markets around the globe remain focused on the European sovereign debt problems. It is becoming clear this is not an issue that will be resolved any time soon, and may require central bank intervention---just as the Fed and other central banks were winding down the support programs.

This week we have experienced the classic flight to quality trade, as global equity markets sank, along with the Euro. While this is ultimately bad news for the global economy, the immediate impact of low mortgage rates for U.S. borrowers is something that should be taken advantage of while the opportunity is here.

Remember, tomorrow is the release of the monthly jobs report, which is currently expected to reflect job growth of 180,000 +, including temporary census workers.

Market commentary

The U.S. Treasury market is benefiting again today from fears of a sovereign debt crisis spreading in Europe. Stocks were battered Tuesday and opened lower again today as investors remain concerned Europe will fall back into recession.

ADP, the U.S. payroll processing company, reported its expected employment gains at 32,000 versus the 30,000 that had been projected. This measure is for private employers, so does not include the U.S. Census workers, which is the main reason Friday’s job report is projected to reflect 189,000 new jobs created in April.

Folks, interest rates have fallen substantially the past few days, with 30 year fixed rate conventional loans once again at 4.75% at a yield spread! Combine this with HSOA’s purchase special and it is a great deal for the borrower’s who recently signed contracts to purchase a home.

Market commentary

A strong increase in factory orders and the expected boost in existing home sales have done nothing to overcome the fear that a financial rescue package for Greece may not be enough to prevent the same thing from happening to other countries. This fear has sent U.S. stocks tumbling with the DOW falling in excess of 200 points.

Treasury prices have rallied as investors seek a safe haven for their money, and mortgage bonds have improved as well. View this day as an opportunity to capture low rates at a great price for your May loan closings!

Market commentary

Good news!! HSOA is waiving the fee for no impounds in CA effective today, May 3, 2010!!

Over the weekend, the European Union and the International Monetary Fund (IMF) announced a support package of $110 billion for Greece. This in an effort to stem the steep drop in European bond prices, which is causing interest rates to spike. So, you may think this is only European tax money on the hook, but the IMF receives support from all major economies, including the U.S. So, good for you---after supporting the bailout of many U.S. companies you are now helping with the European bailout.

This week’s economic calendar is heavy with important data, culminating with Friday’s employment data. As of today, economists are projecting the U.S. economy added approximately 180,000 new jobs. This morning, we saw data that manufacturing accelerated last month and consumer spending increased for the sixth straight month.

Bond prices are retreating from Friday’s rally, and have given back most of the gains—even in the face of continued uncertainty in Europe. Expect another week of volatility.