The Mortgage Buddy Rate Outlook for the Week Begninning 6/27

The Mortgage Buddy Rate Outlook for the Week Begninning 6/27

The market continues to run scared on the fears of a spreading European debt crisis, and a slow down in the global economy. Last week saw a very volatile week in the market but it ended with some better than expected durable goods orders and .1% higher on the final 1st quarter GDP numbers.

 I truly believe our economy is going to be just fine. Corporate earnings will drive the market up but that's still about 2 weeks a way. Until then we are going to be on shaky ground and we could break even lower with rates and the stock market. Everyone wants better jobs numbers but companies continue to find ways to make money with smaller payrolls and lower overhead so I just don't think the jobs are going to come back too quickly.

Lets take a look of what on the calendar this week that could move the rates.

Tuesday 9am Case/Schiller Index:Look for another round of disappointing data as home prices continue to slide down. This is just the reality we are in and lets focus on the positives. The S&P/Case-Shiller home price index tracks monthly changes in the value of residential real estate in 20 metropolitan regions across the U.S. The composite indexes and the regional indexes are seen by the markets as measuring changes in existing home prices and are based on single-family home resales.

Wed. 10am Pending Home Sales: A pending sale is one in which a contract was signed, but not yet closed. It usually takes four to six weeks to close a contracted sale. Let's keep our fingers crossed on this one. Rates are low and home prices are down let's keep moving the inventory.

Friday 10am Construction Spending: The dollar value of new construction activity on residential, non-residential, and public projects. Data are available in nominal and real (inflation-adjusted) dollars.

There are several other data points on tap this week including some key manufacturing data and consumer sentiment.

Opinion:

I'm looking for a choppy market but if numbers are week we could break down some key technical levels. I like to watch the S&P as an indicator as to where the market is moving since it's such a wide range of companies. We have 3 times touched the 200 day moving average of about 1260 and every time we have bounced off it. If we break below that we could go all the way to 1220. I don't think any of this pull back is too much to be worried about right now. It's really going to come down to earnings next month and what those look like. If those stink look out below. Mortgage rates will hit historic lows and we could head for a double dip recession. I don't think that's going to happen. I think rates will be flat to lower as we inch closer and close to 4% on a 30yr fixed mortgage. If you are concerned about your 401k you may want to rotate some money into larger cap stocks, health care, and utilities. These are traditionally a little safer investments.