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Daily Market Analysis April 1, 2021

April 1st, 2021 9:39 AM by Richard Sardella MLO.100007700/NMLS 233568


Daily Market Analysis

Not an April fool's joke; yesterday afternoon after 4:00 pm ET, MBS prices came under pressure and declined 12 bps on the day. At 4:00 pm yesterday, the 2.5 30 yr. coupon was unchanged on the day, by 5:00 pm down 12 bps. The 10 yr. note yesterday end at 1.74%, +1 bps. This morning the 10 yr. at 1.69% -5 bps.

At 8:30 am ET, weekly jobless claims were expected at 680K -4K from the prior week. Claims the prior week revised from 684K to 658K, claims increased to 719K +61K; the 4-week average 719K from 729.5K. The unexpected increase in claims underscores the choppy nature of the labor market recovery and indicates it will take time to recoup the millions of jobs lost because of the pandemic. However, vaccinations are increasing, and business restrictions are easing, suggesting employment will accelerate in the coming months.

At 9:30 am ET, the DJIA opened +111, NASDAQ +163, S&P +26. 10 yr. at 9:30 am 1.69% -5 bps. FNMA 2.5 30 yr. coupon at 9:30 am +16 bps from yesterday's close and +5 bps from 9:30 yesterday.

At 9:45 am ET, the final March PMI manufacturing index expected at 59.0 from 58.6, as released 59.1.

At 10:00 am ET, the March ISM manufacturing index expected at 61.5 from 60.8, increased to 64.7.

Also at 10:00 am ET, Feb construction spending, expected at -0.8%, as reported -0.8%; yr./yr. +5.3%. Jan spending revised from 1.7% to 1.2%.

Tomorrow's March employment report, earlier this week, the whispering was job growth would be better than forecasts (+625K NFP jobs, private jobs +538K).

Technically the 10 yr. tested its recent high at 1.74% 4 times and held; brings into focus whether the 10 yr. is setting up for a decline as we see so far this morning, hearing more talk that rates may hold here and decline somewhat. Employment data tomorrow will likely resolve the momentary thinking.

PRICES @ 10:00 AM ET

10 yr. note: 1.69% -5 bp

5 yr. note: 0.92% -2 bp

2 Yr. note: 0.16% unch

30 yr. bond: 2.36% -5 bp

Libor Rates: 1 mo. 0.111%; 3 mo. 0.194%; 6 mo. 0.205%; 1 yr. 0.283% (3/31/21)

30 yr. FNMA 2.0: @9:30 99.88 +22 bp (+13 bp from 9:30 yesterday)

30 yr. FNMA 2.5: @9:30 102.64 +16 bp (+5 bp from 9:30 yesterday)

30 yr. GNMA 2.5: @9:30 102.88 -2 bp (+11 bp from 9:30 yesterday)

Dollar/Yuan: $6.5687 +$0.0160

Dollar/Yen: 110.68 -0.04 yen

Dollar/Euro: $1.1759 +$0.0027

Dollar Index: 93.05 -0.18

Gold: $1724.80 +$9.20

Bitcoin: 58,971 +40

Crude Oil: $60.16 +$1.00

DJIA: 33,066 +76

NASDAQ: 13,450 +203

S&P 500: 4003 +30

About Richard Sardella

Richard Sardella has been actively managing and providing services in the mortgage industry for over 27 years. Richard serves on the board of directors as President of Colorado Home Mortgages Inc.

About This Report And Disclosure Information

All information furnished has been forwarded to you and is provided by thetbwsgroup only for informational purposes. Forecasting shall be considered as events which may be expected but not guaranteed. Neither the forwarding party and/or company nor thetbwsgroup assume any responsibility to any person who relies on information or forecasting contained in this report and disclaims all liability in respect to decisions or actions, or lack thereof based on any or all of the contents of this report.

MLO of record MLO.100007700 / NMLS#233568 / CHM NMLS#127716.

Posted by Richard Sardella MLO.100007700/NMLS 233568 on April 1st, 2021 9:39 AM

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