Incline Village Home Loans, Incline Village Mortgages, Incline Village Mortgage Rates, and Incline Village Home Loan Rates:
Friday’s bond market has opened in positive territory with stocks in selling mode during early trading. The Dow is currently down 147 points while the Nasdaq has lost 60 points. The bond market is currently up 10/32 (2.65%), which should improvement this morning’s mortgage rates by approximately .125 of a discount point.
We saw a little strength in bonds again yesterday afternoon despite a lackluster or average auction of 7-year Treasury Notes. This caused some lenders to issue slightly improved rates but I suspect many waited for this morning’s pricing to reflect that adjustment. This morning’s move in the 10-year yield puts us pretty close to the middle of its recently quite narrow trading range. The middle of a wide trading range is a sign that we will see a move either direction, leading to a noticeable change in rates in the immediate future. The fact that we are in the middle of a narrow range means that a move either way isn’t a concern unless the yield breaks below or above that range because the swing to either end equates to a just small change in rates.
What is concerning or at least noteworthy is the fact that we have seen mortgage bonds close in the negative three of the past four final trading days of the week (Thursday last week due to holiday). So while this morning’s open looks good, be cautious as the afternoon nears. If bonds start to lose momentum and begin to give up this morning’s gains, it would be a safe bet to plan on a negative close. Since we are seeing improvements this morning, it could lead to an afternoon increase in mortgage rates.
The University of Michigan posted their revised Index of Consumer Sentiment for April late this morning, revealing a reading of 84.1. This was higher than the preliminary estimate of 82.6, higher than forecasts, and the highest reading since last summer. The data indicates surveyed consumers were more optimistic about their own financial and employment situations than many had thought. Because higher levels of sentiment usually translates into stronger levels of consumer spending and economic growth, we should consider the data negative for the bond and mortgage markets. Fortunately, this report is not looked at as a key piece of data, limiting its impact on this morning’s mortgage rates.
Next week is a HIGHLY active week for the financial and mortgage markets. We have what many consider to be three of the most important economic reports all scheduled for release in the same week. On top of that, there is also another FOMC meeting next week in addition to a handful of moderately important reports. None of them are scheduled for Monday, but the rest of the week is likely to be quite volatile, particularly the last three days.