Market commentary

Bond prices tumbled Monday as stocks rallied sharply on positive economic data. As is often the case, the reverse is true today. The Conference Board’s Consumer Confidence Index for August fell dramatically to 44.5 from 59.2. This is the lowest reading since April 2009.

The CaseShiller Home Price Index for June shows that home prices fell 0.06% month over month. For keeping score purposes, twelve of the past thirteen months have shown drops in prices, and year over year, prices have fallen 4.52%. If we take something out of this report other than that home prices continue to be weak, it is that the 2011 data is weaker than the 2009 and 2010 data during the peak summer months. There is certainly a sense that the bounces in housing were catalyzed by government intervention into the markets and without that support the market is struggling to find a foundation.

Later today, the FOMC will release the minutes from the August meeting.

As mentioned above, the markets have reversed as a result of this morning’s economic data, with bond prices higher and stocks trading lower. Mortgage prices have improved by approximately .375%.