Mortgage Rates

Anthony Hood
Equity Investment Capital
Office: 949-891-0067
Email: tony@equityinvestmentcapital.com
website: www.equityinvestmentcapital.com


Building Strong, Lasting Relationships; One Client at a Time.


Thursday, December 23, 2010


Treasuries and mortgages opened a little weaker this morning. At 8:30 three data points; weekly jobless claims at 420K down 3K, last week's claims were revised up 3K to 423K. Nov durable goods orders expected down 0.6% were down 1.3% overall but taking transportation orders out durables were up 2.4%; Oct orders were revised to -3.1% frm -3.3%. Nov personal income expected up 0.2% increased 0.3%; spending expected up 0.5% was up 0.4%. The rate markets, already lower in price didn't move on the data; the 10 yr at 8:45 -6/32, 30 yr mtgs -7/32 (.22 bp), right where they traded prior to 8:30.

At 9:55 the U. of Michigan consumer sentiment index, expected at 74.5 from 74.2 hit at 74.5. The 12 month outlook index at 79 frm 77. expectations index at 67.5 frm 66.8. Overall another positive report for the economy but the index is volatile.

At 10:00 Nov new home sales expected up 6.5% were lower at +5.5% at 290K units against expectations of 300K. Oct sales revised lower to -10.7% from -8.1%. Based on present sales there is an 8.2 month supply compared to 8.8 months supply in Oct.

The U. of Michigan index put additional pressure on the bond and mortgage markets, prices dipped 5/32 (.15 bp) on 30 yr mtgs from where they traded at 9:30.

Rounding out the day, at 11:00 Treasury will announce the details for next week's auctions; dealers are expecting the total of $99B unchanged from last month, $35B of 2 yr notes on Monday, $35B of 5 yr notes Tuesday, and $29B of 7 yr notes on Wednesday.

Based on prices at 10:05 this morning 30 yr mtgs this week are 3/32 (.09 bp) frm last Friday's close. The 10 yr note yield increased 5 basis points from last Friday's close.