Market commentary

Concern about the solvency of several European banks and the continued high yields many European countries have to pay to refinance or issue new debt is again taking its toll on the markets. This was the driver pushing U.S. Treasury yields lower on Wednesday.
Today brings the last real economic data for the year, beginning with initial jobless claims for the week ending December 24 rising from 366,000 to 381,000. While the figures reflect a 15,000 jump in initial claims, 381,000 is still well below 400,000 and continues to point to an improving labor market.

In a sign American manufacturing is weathering the slowdown in Europe; the Institute for Supply Management-Chicago Inc. said today its business barometer decreased slightly to 62.5 from 62.6 in November. Most analysts had expected a more pronounced decline, and recall readings above 50 signal growth.

And finally, the number of Americans signing contracts to buy previously owned homes rose 7.3% in November, more than forecast as falling prices and low borrowing costs boosted demand. I think most of us agree now is a great time to buy a home, assuming one is secure in their job and source of income, and can produce the documentation to qualify for a loan!

Pricing for mortgages are flat from the close on Wednesday.