From the technical picture, the chart is content to hang out near the highs (low yield mark) but cannot take it out. The downside (selling) has been limited as well with the regression line since October supporting the market as well as the 8 and 21 day moving averages. We call this a goldilocks market, not to hot, not to cold, but just right. Really, the market is marking time, ready to grab a turkey leg and a cold one.
Although the home price numbers are good, uncertainty with the 8K stimulus plan and continued high unemployment will need to be monitored
Hey what do you know, a little green on the screen! Case Shiller Home Price Index painted the screen with an improvement of 1.2% while the year on year figure was down 11.3%. The number were a bit better than consensus, showing signs of stability creeping back into the housing market. 17 of the 20 market surveyed showed positive price improvement with Charlotte, Las Vegas, and Cleveland the only decliners. Although the numbers are good, uncertainty with the 8K stimulus plan and continued high unemployment will need to be monitored.
As predicted, Friday’s bearish close, along with this week’s record 137 billion in treasury auction supply has kept the market under pressure as we begin a new week
As predicted, Friday’s bearish close, along with this week’s record 137 billion in treasury auction supply has kept the market under pressure as we begin a new week. 7 billion in 5 year tips will greet the screen today, followed by 44 billion of 2 year notes on Tuesday, 41 billion of 5 year notes on Wednesday, and 31 billion of 7 year notes on Thursday. This could give the market a bit of indigestion. Traders talk about “no shows at the lows”, meaning that buyers will not show up even at cheaper levels. We believe that a strong overseas bid will continue and with most of paper being shorter in duration, the auctions “should” be much ado about nothing.
The week ahead is shaping up to be a barn burner. Month end, Quarter end, and the Employment Report for September are just a few of the events that could rock our world.
Unless something is way out of whack with the 2 year auction, expect Austin mortgage pricing to stay close to home
Just a quick note before the results of today’s 42 [...]
English translation is that the rally could be short lived in front of 109 billion in paper and a stock market that just won’t break
Strange start to the week as stocks opened on the [...]
Volatile mortgage price action as stocks are off 52 points on the big board and bonds trade like a Six Flags ride
Bonds, notes and mortgage backs had a nice start to [...]
We see the selling as shallow into the later part of the week and then a rebound/rally to deliver better mortgage pricing as we close the book on July
Both stocks and bonds opened on the weak side this [...]
Tough to tell if we are seeing stabilization or some kind of an outlier, given the changes in manufacturing (auto makers) coming down the line in that region
Mixed markets have greeted us on this last day of [...]
After a roller coaster month, started by the surprise payroll [...]