CHM Blog

The 10 year note at 8 am ET 3.83% +8 bp, the 2 year note 4.85% +7 bps. MBS prices began the session -12 bps.

Weekly jobless claims declined 12K from the prior week to 228K, the 4-week average declined from 246.75K to 237.50K. Two weeks in a row claims have declined, the week before down 12K. Good news for the Fed that worries over high levels of employment and high wages. Claims dropped in 29 of the 53 states and territories that report these figures to the federal government. Claims this time of year can be misleading, the end of the school year, auto plant layoffs and the holiday. The actual or unadjusted number of new jobless claims barely budged, slipping to 257,976 from 258,302 in the prior week. Actual claims are up sharply, however, from a pandemic-era low of 152,000 last fall.

Also at 8:30 am, the July Philadelphia Fed manufacturing index, doesn’t get much attention from traders but once again the index is negative at -13.5 against estimates of -10.2. The index has been negative for 11 straight months. On Monday, the NY Empire State manufacturing index also weak. The ISM factory index contracted in June for the eighth straight month, falling to 46% from 46.9% in the prior month.

Someone in California won Powerball yesterday.

At 9:30 am the DJIA opened +102, NASDAQ -85, S&P -9. 10 year at 9:30 am +6 bps.

At 10 am June existing home sales, expected at 4.23 mil from 4.30 mil, sales declined to 4.16 mil, 3.3% the lowest level in 14 years. Very low inventory, 3.1 months supply at the current sales pace. Year/year existing home sales -18.9%

China’s economy is slowing, some now concerned that the weakness may spill over to the US. The concern is China may follow Japan who has had slowed growth for years. Janet Yellen said China’s economic slowdown risks causing ripple effects across the global economy, though she doesn’t expect a recession in the US. A Vanguard survey saying the stock market is the most bullish since the 2022 bear market. Investors in June said they expected U.S. stocks to return 5.5% in the next 12 months, up from a 3.7% expected yearly increase for stocks as of April, and the highest reading since the 6% forecast in December 2021. In Jan 2022 the S&P hit an all-time high then fell 20%. Presently investors need a huge black swan to cool the equity markets.

PRICES @ 10:00 AM

10 year note: 3.85% +9 bp

5 year note: 4.10% +10 bp

2 year note: 4.84% +6 bp

30 year bond: 3.89% +5 bp

30 year FNMA 6.0: @10 am 100.69 -31 bp (-36 bp from 9:30 am yesterday)

30 year FNMA 5.5: @10 am 99.49 -32 bp (-41 bp from 9:30 am yesterday)

30 year GNMA 5.5: @10 am 99.45 -36 bp (-28 bp from 9:30 am yesterday)

Dollar/Yuan: $7.1699 -$0.0571

Dollar/Yen: 139.93 +0.29 yen

Dollar/Euro: $1.1183 -$0.0020

Dollar Index: 100.50 +0.21

Gold: $1977.50 -$3.30

Bitcoin: 30,253 +276

Crude Oil: $76.15 +$0.80

DJIA: 35,269 +208

NASDAQ: 14,242 -116

S&P 500: 4556 -9

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.