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Daily Market Analysis February 17, 2022

February 17th, 2022 10:26 AM by Richard Sardella MLO.100007700/NMLS 233568


Daily Market Analysis

Safety moves this morning into treasuries as tensions in the Ukraine heat up, stock indexes under pressure in pre-opening futures markets this morning. At 8:30 am ET the 10 yr note down to 1.98% -6 bps and the DHIA down 227. Pro-Russian separatists and Ukrainian authorities traded allegations of cease-fire violations along the tense front line separating the two sides, as Western officials said Moscow continued to mass troops along the border of its smaller neighbor. WSJ: “The Ukrainian government said Kyiv-controlled areas of the Luhansk region came under sustained shelling Thursday morning. A direct hit to a kindergarten in the town of Stanytsia Luhanska injured two teachers, the military said. Shelling also destroyed a house in the village of Vrubivka and hit the courtyard of a high school. There was no immediate information on casualties there, according to the local civilian-military administration.” The Kremlin has sent mixed signals in recent days, announcing the drawdown of some of its troops and suggesting Moscow could be open to negotiations with the West to defuse the crisis and address what it says are threats from Western powers to Russia’s security. But Western officials say Russia instead has continued its military buildup around Ukraine. U.S. and Russian military aircraft flew dangerously close to each other in three separate weekend incidents over the Mediterranean Sea, including one in which the planes passed within 5 feet, Pentagon officials said yesterday.

Data at 8:30 am: weekly jobless claims increased 23K to 248K, the first increase in three weeks. The consensus estimates as of yesterday 218K. Claims were for the week ended 2/12, that time period is particularly scrutinized because it reflects the reference week for the February jobs report that’s due early next month. Employment in the wider picture is only abut 50K higher than prior to the pandemic when claims were hovering around 200K.

Jan housing starts and permits at 8:30 am; residential starts dropped 4.1% last month to a 1.64 million annualized rate with forecasts at 1.708 mil; building permits rose to 1.9 mil against estimates of 1.760 mil. The increase in building permits and a pickup in the number of homes authorized but not yet started suggests residential construction will remain healthy in coming months. Single-family starts declined 5.6% in January to an annualized pace of 1.12 million units as multifamily starts -- which tend to be volatile and include apartment buildings and condominiums -- decreased to 522,000. The number of one-family homes authorized for construction but not yet started climbed 5.6% to 151,000 in January, one of the highest levels in 15 years.

Finally, at 8:30 am the Feb Philadelphia Fed manufacturing index was expected at 19.7 from 23.2 in Jan, the index slipped to 16.0.

At 9:30 am the DJIA opened -213, NASDAQ -139, S&P -31. 10 y 1.99% -5 bps. FNMA 3.5 30 yr coupon at 9:30 am +11 bps from yesterday and -4 bps from 9:30 am yesterday.

PRICES @ 10:00 AM

10 yr note: 1.97% -7 bp

5 yr note: 1.86% -7 bp

2 Yr note: 1.48% -4 bp

30 yr bond: 2.28% -7 bp

Libor Rates: 1 mo 0.137%; 3 mo 0.488%; 6 mo 0.787%; 1 yr 1.330% (2/16/22)

30 yr FNMA 3.0: @9:30 100.28 +23 bp (+9 bp from 9:30 am yesterday) at 10:00 am +34 bps on the day

30 yr FNMA 3.5: @9:30 102.42 +11 bp (-4 bp from 9:30 am yesterday) at 10:00 am +22 bps on the day

30 yr GNMA 3.0: @9:30 101.08 +20 bp (+6 bp from 9:30 am yesterday) at 10:00 am +22 bps on the day

Dollar/Yuan: $6.3373 unch

Dollar/Yen: 114.90 -0.56 yen

Dollar/Euro: $1.1356 -$0.0019

Dollar Index: 95.79 +0.09

Gold: $1895.90 +$24.80

Bitcoin: 41,898 -2307

Crude Oil: 92.26 -$1.40

DJIA: 34,482 -452

NASDAQ: 13,930 -193

S&P 500: 4413 -61

About Richard Sardella

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.

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 February 17th, 2022 10:26 AM

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