October 1st, 2020 9:31 AM by Richard Sardella MLO.100007700/NMLS 233568
Weekly MBA mortgage apps slipped last week. The composite down 4.8%, purchase apps -2.0% while refinances were down 7.0%.
ADP Sept private jobs were expected around 650K, as released +749K; August ADP jobs revised to 481K from 428K. Recent ADP data has been well off what the BLS official report data shows; in August, the BLS reported private jobs increased 1.027 mil. Used to be ADP was seen as a precursor to the BLS data that happens two days later. Now, not many pay much attention to it.
Q2 final GDP increased to -31.7%, the worst read in the history of the data that began back in 1950. It was expected based on the prior releases but is slightly lower than -31.4% on the preliminary release last month—the personal consumption expenditures on an annual basis -33.2%.
Another try to get a stimulus deal? Pelosi and Mnuchin are talking today. They talked yesterday with no movement. The divide is Democrats want more funding for things that Republicans don’t believe necessary. Optimism is fading fast; if there is no compromise, Democrats will vote their $2.2 trillion package in the House. Private economists have increasingly abandoned predictions for a deal before the election. JPMorgan Chase & Co. and Goldman Sachs Group Inc. recently cut their forecasts for growth next quarter as a consequence.
At 9:30 am ET, the DJIA opened +200 after trading lower early today, NASDAQ +40, S&P +17. 10 yr. at 9:30 am unchanged at 0.66%. FNMA 2.0 30 yr. coupon at 9:30 am -8 bps from yesterday’s close and unchanged from 9:30 am yesterday. FNMA 2.5 30 yr. coupon -2 bps from yesterday’s close and +1 bps from 9:30 am yesterday. This morning, trading in MBSs is volatile; at 9:45 am, the 30 2.0 coupon down just 3 bps.
At 9:45 Sept Chicago PMI index was expected at 52.1; as released jumped to 62.4, shocking many and added to stock improvements. The index actually was released at about 9:00 am.
At 10:00 am ET, August pending home sales, expected at +3.1%, exploded +8.8%, the strongest jump since 2001.
Interest rates still locked, MBS pricing choppy. The 10 yr. hasn’t changed since the begging of Sept, one month with no movement.
PRICES @ 10:00 AM ET
10 yr. note: 0.67% +1 bp
5 yr. note: 0.26% +1 bp
2 Yr. note: 0.13% -1 bp
30 yr. bond: 1.45% +4 bp
Libor Rates: 1 mo. 0.149%; 3 mo. 0.225%; 6 mo. 0.265%; 1 yr. 0.359% (9/29/20)
30 yr. FNMA 2.0: @9:30 103.41 -6 bp (+2 bp from 9:30 yesterday)
30 yr. FNMA 2.5: @9:30 104.94 -2 bp (+1 bp from 9:30 yesterday)
30 yr. GNMA 2.5: @9:30 104.66 -5 bp (-3 bp from 9:30 yesterday)
Dollar/Yuan: $6.8080 -$0.0085
Dollar/Yen: 105.73 +0.06 yen
Dollar/Euro: $1.1691 -$0.0052
Dollar Index: 94.15 +0.26
Gold: $1891.10 -$12.10
Crude Oil: $39.40 +$0.11
DJIA: 27,773 +283
NASDAQ: 11,186 +101
S&P 500: 3363 +28
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.
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.