Market Update

MBS are up +1/32 (FNMA 30-yr 3.5 at 103.07), around 7/32 higher than yesterday at this time. Favorable repricing took place yesterday.

This morning, the Philly Fed regional manufacturing index jumped to 38.8, well above the consensus of 20.0. Weekly Jobless Claims fell to 232K, below the consensus of 240K. The Dow is down 25 points. No more economic data will be released today.

Market Update 5/17/2017

MBS are up +10/32 (FNMA 30-yr 3.5 at 103.00), around 13/32 higher than yesterday at this time. Favorable repricing took place yesterday.

After the election, stocks and bond yields moved higher based on expected policy changes under the Trump administration. The recent controversy has increased the uncertainty about the ability of the President to implement these changes. As a result, stocks have dropped and MBS prices have climbed this morning. The Dow is down 175 points. No economic data will be released today.

Market Update 5/16/2017

MBS are up +1/32 (FNMA 30-yr 3.5 at 102.19), around 2/32 higher than yesterday at this time.

Mixed economic data has had little impact on MBS this morning. April Housing Starts fell 3% from March to an annual rate of 1.17 million, below the consensus of 1.26 million. April Industrial Production rose 1.0% from March, above the consensus for an increase of just 0.5%. The Dow is up 50 points. No more economic data will be released today.

Morning update 5/11/17

MBS are up +1/32 (FNMA 30-yr 3.5 at 102.04), around 7/32 lower than yesterday at this time. Unfavorable repricing took place yesterday.

This morning, April PPI rose 0.5% from March, well above the consensus of 0.2%, and it was 2.5% higher than a year ago. Core PPI also exceeded expectations and was 1.9% higher than a year ago, up from 1.6% last month. Weekly Jobless Claims fell to 236K, below the consensus of 245K. There has been little reaction to today’s data. The Dow is down 100 points. No more economic data will be released today. The results from the 30-yr Treasury auction will come out around 1:00 et.

Market Update

BEEN A BAD Week for Interest rates

MBS are down -4/32 (FNMA 30-yr 3.5 at 102.03), around 8/32 below morning levels, and near the low for the day. Unfavorable repricing took place. Weak demand for the 10-yr Treasury auction was the main cause of the decline in MBS prices today. The Dow is down 30 points. Tomorrow, PPI and Jobless Claims will be released at 8:30 et. The results from the 30-yr Treasury auction will come out around 1:00 et.

TGIF

MBS are up +1/32 (FNMA 30-yr 3.5 at 102.20), around 5/32 higher than yesterday at this time.

This morning, the important Employment report came in right on target and had little net impact on MBS. Against a consensus forecast of 190K, the economy added 211K jobs in April. Downward revisions subtracted 6K jobs from the results for prior months. The unemployment rate declined from 4.5% to 4.4%, below the consensus of 4.6%, and the lowest level since May 2007. Average hourly earnings, an indicator of wage growth, matched expectations. They were 2.5% higher than a year ago, down from a revised 2.6% last month. The Dow is down 20 points. No more economic data will be released. There will be several Fed speakers today.

Market Update 5/3/2017

MBS are down -1/32 (FNMA 30-yr 3.5 at 102.26), around 4/32 higher than yesterday at this time. Favorable repricing was seen yesterday.

This morning, the ADP estimate for private sector job gains in April was 177K, a little above the consensus of 170K. The Dow is down 25 points. ISM Services will be released at 10:00 et. The Fed statement will be released at 2:00 et. No change in rates is expected, but investors will be looking for guidance about the pace of future tightening.

Market Update 5/2/2017

MBS are up +5/32 (FNMA 30-yr 3.5 at 102.26), around 6/32 above earlier morning levels, and near the high for the day. Favorable repricing was seen. MBS drifted higher today ahead of tomorrow’sFed meeting. No economic data was released. The Dow is up 35 points. Tomorrow, the Fed statement will be released at 2:00 et. No change in rates is expected, but investors will be looking for guidance on the pace of future tightening. Before that, ADP Employment and ISM Services will be released.

Market Update 4/27/2017

MBS are down -1/32 (FNMA 30-yr 3.5 at 102.20), around 5/32 higher than yesterday at this time. Favorable repricing took place yesterday.

With few surprises from the ECB or the data, it has been a quiet morning. The European Central Bank (ECB) made no policy changes. Some investors think that ECB officials might hint at tighter policy at the next meeting if Macron, the pro-EU candidate, wins the French Presidential election on May 7. In the U.S., March Durable Orders rose 0.7% from February, below the consensus of 1.2%, but the February results were revised higher to 2.3% from 1.7%. Weekly Jobless Claims rose to 257K, above the consensus of 245K. The Dow is up 10 points. Pending Home Sales will be released at 10:00 et. The results from the 7-yr Treasury auction will come out around 1:00 et.

Market Update !!!!!

MBS are down -5/32 (FNMA 30-yr 3.5 at 102.21), around 10/32 lower than Friday at this time. Some unfavorable repricing took place Friday.

This morning, investors have shifted to riskier assets in reaction to the outcome of yesterday’s key French Presidential election (see below). While a decline in MBS prices very late in the day on Friday has made today’s drop look a little smaller than it might have been, global bond markets generally are performing poorly today. The Dow is up 200 points. No economic data will be released today.

One pro-EU candidate (Macron) and one anti-EU candidate (Le Pen) won the first round of the election and will compete in the second round on May 7. Polls indicate that Macron is favored to win by about a 65% to 35% margin. Investor concerns about a French exit from the European Union were eased by the election results, causing a reversal of the flight to safety trade.