Wednesday Market UpDate

By
Mortgage and Lending with Roxy Redenbaugh (Acceptance Capital Mortgage Corporation)

Wednesday's bond market has opened in positive territory following favorable economic data and early stock losses. The stock markets initially opened well into negative territory, but have since recovered a good portion of those earlier losses. As the major stock indexes climbed from morning lows, the bond market gave back some of its early gains. Stocks are currently mixed with the Dow down 12 points and the Nasdaq up 2 points. The bond market is currently up 5/32, which should still improve this morning's mortgage rates by approximately .125 of a discount point.

The Commerce Department reported this morning that new orders for durable goods rose 0.3% last month, falling well short of the 3.0% gain that was expected. In addition, the reading that excludes large transportation-related orders fell 3.8% when it was forecasted to show a small increase. This means that the manufacturing sector was not as strong as expected. Durable goods orders are known to be quite volatile from month to month, so a large headline number doesn't usually cause much alarm. However, this morning's readings were enough of a variance from forecasts to add more fuel to the theory that the economy is moving away from a recovery. That is good news for the bond market and long-term securities such as mortgage-related bonds.

July's New Home Sales data was also posted this morning, but it drew much less attention than the Durable Goods report did. It revealed a decline in sales of newly constructed homes when analysts had forecasted a small increase, translating into another measure of housing sector weakness. However, this report is not known to cause much movement in the markets or mortgage rates because it tracks a small portion of all home sales in the U.S. Therefore, its results had little impact on this morning's bond market and mortgage pricing, leaving the Durable Goods Orders report to drive trading.

close

This entry hasn't been re-blogged:

Re-Blogged By Re-Blogged At
Topic:
ActiveRain Community
Groups:
Diary of a Realtor
Investors
Posts to Localism
Realtors®
The Optimist
Tags:
bond market
mortgage rates
stock market
home sales
durable goods

Spam prevention

What's the reason you're reporting this blog entry?

Are you sure you want to report this blog entry as spam?

Rainmaker
39,284

Roxy Redenbaugh

NMLS#269926
Ask me a question
*
*
*
*