Current Trend Direction: Higher
Risks favor: Floating
Current Price of FNMA 5% Bond: $101.62, -3bp
The Job Market continues to struggle. Initial Jobless Claims were reported at 554,000, near expectations, but still a bad number. The four-week average of Claims rose 2,750 to 543,750 - the highest level since December 1982. And the four-week average of continuing Claims rose 92,000 to 4.23 million -- the highest since January 1983. Mortgage Bonds have had little reaction to the release.
Leading Economic Indicators and the Philadelphia Fed Index are due out a little later, but unless these reports really miss the mark - there may not due much to influence the market.
Oil is now trading at $38.64 - wow. This should translate to some nice prices at the pump. It is really amazing how people were saying Oil was going to be $200 a barrel. Now we are hearing forecasts of possibly $25 a barrel. Still, the longer-term view for Oil will likely be much higher...it is just a matter of time.
Hopefully, you locked on yesterday's alert and missed the sudden price erosion, but on new transactions, let try and float and see if Bonds can regain their footing and move higher again.
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