CHM Blog

There isn’t any scheduled news today, the only issue is how the $42B 10 year note auction is received at 1 pm ET this afternoon. The U.S. session will not feature any top-tier data.

Total mortgage applications in the US rose by 3.1% from the previous week in the last week of July, trimming the 3.8% decline from the earlier period to set the sharpest growth rate in nearly one month, according to data compiled by the Mortgage Bankers Association. Applications to refinance a mortgage rose by 5.1%. In turn, applications for a mortgage to purchase a new home rose by a softer 1.5%.

This week, other than the treasury auctions the only important data comes tomorrow with weekly jobless claims (220K from 218K).

Last Friday’s surprise revisions to employment being marked lower than previously reported by 585K sent rates down and cemented a 25 bp rate cut at the September 17th FOMC meeting. The fall of the 2 year note by 28 bps at the present levels has fully discounted the cut. The 10 year note yield yesterday and Monday at 4.20% matches the low yield on July 1st, a slight technical barrier that will take more news to break below it.

Will there be more cuts after September? Will the FOMC cut by 50 bps at the September meeting? It depends on jobs, inflation, and economic growth. Next week July CPI and PPI and July retail sales will drop.

At 9:30 am the DJIA opened +62 after slipping 62 yesterday, NASDAQ opened +46 from -137 yesterday, S&P +12 from -31 yesterday. 10 year note at 9:30 am 4.23% +1 bp. FNMA 6.0 30 year coupon at 9:30 am -2 bps from yesterday’s close and +2 bp from 9:30 am yesterday.

At 1 pm $42B 10 year note auction.

PRICES @ 10:00 AM

10 year note: 4.22% unch

5 year note: 3.78% unch

2 year note: 3,73% -1 bp

30 year bond: 4.81% +2 bp

30 year FNMA 6.0: @9:30 am 101.86 -2 bp (+2 bp from 9:30 am yesterday)

30 year FNMA 6.5: @9:30 am 103.40 -5 bp (-2 bp from 9:30 am yesterday)

30 year GNMA 6.0: @9:30 am 101.69 -4 bp (+4 bp from 9:30 am yesterday)

Dollar/Yen: 147.33 -0.27 yen

Dollar/Euro: $1.1626 +$0.0049

Dollar Index: 98.47 -0.31

Gold: $3,422.00 -$12.70

Bitcoin: 114,122 +500

Crude Oil: $66.38 +$1.23

DJIA: 44,098 -13

NASDAQ: 20,974 +58

S&P 500: 6310 +11

Richard Sardella has been actively managing and providing services in the mortgage industry for over 30 years. Richard serves on the board of directors as President of Colorado Home Mortgages Inc.

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.