Market Snapshot

Treasuries and mortgage markets opened weaker this morning after the selling on Friday that pushed interest rates up 13 basis points. No economic releases today but the rest of the week does have data to chew over. The main focus this week for treasury and mortgage markets is Treasury auctioning $109B of notes (2 yr, 5 yr, and 7 yr). Supply from Treasury generally keeps interest rates under pressure. Not only supply, but the stock market is playing against treasuries and mortgages as it continues to defy traders, technicals and fundamentals as it resists any sustained selling. Traders are being ripped up daily trying to short equity markets, with the high majority of market participants (including the most bullish) expecting a big retracement. It just won’t happen as long as that is what is widely anticipated.

 

At 8:30 this morning the 10 yr note was off 10/32, mortgages were down 7/32. At 9:00 the 10 -8/32, mortgages off 5/32 and the stock indexes were aiming for a better open at 9:30, ( the DJIA +40) after a run of 156 points on Friday. Expect more volatility today as trading volumes remain very thin. With no data to think about the rate markets will move with equity market trading. Tomorrow Treasury will start the borrowing with $42B of 2 yr notes. Over the past two months Treasury has had little trouble selling new notes, demand from indirect bidders continues to be strong.

 

 

“Your Partner In Success!”

 

Tony Frerking

Sr. Mortgage Consultant

PMZ Home Loans

1600 N. Carpenter Rd Ste. A-1

Modesto CA 95351

 

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