Market Snapshot

ADVICE:  For loans being locked for 15 - 30 days, we suggest...(more)

Treasuries and mortgages opened a little better this morning; 10 yr +4/32 at 8;00 and mortgages +3/32 (.09 bp). At 8:30 two data points; March personal income +0.5% and spending +0.6%, both in line with estimates The price index in March yr/yr +1.8% up frm +1.6% yr/yr in Feb; the core +0.9% yr/yr unchanged from Feb yr/yr. Q1 employment cost index also on target, +0.6%, up frm 0.4% in Q4 2010 and +2.0% yr/yr. Both reports were in line with forecasts and there was no noticeable reaction to either.

At 9:30 the DJIA opened -15, the 10 yr note that was up 3/32 at 9:00 under pressure down 4/32 and mortgages down 1/32 (.03 bp). Prior to the remainder of the economic data this morning the equity and rate markets showed some volatility, by 9:40 after opening lower the DJIA turned and was up 25 points. (see below for 10:10 level)

More data at 9:45; the April Chicago regional manufacturing index expected at 68 frm 70.6 hit at 67.6. New orders index 66.3 frm 74.5, prices pd for materials 81.8 frm 83.4, and employment component at 63.7 frm 65.6. Slightly weaker but largely ignored in the markets. Any index read over 50 is considered expansion, the overall index is the lowest this year so far but still strongly above 50.

At 9:55 the U. of Michigan consumer sentiment index, expected at 69.6, unchanged from the last read, was 69.8 and down from final March 67.5. Current conditions index at 82.5 unch, expectations index at 61.6 frm 57.9 and the 1 yr out inflation index 4.6 unchanged. Like all the other data this morning it was in line with forecasts.  

The dollar weaker this morning but recovering slightly from the lowest levels early. The Fed is targeting the dollar wanting it to fall in an effort to increase exports and keep the economic recovery going. IN the meantime gold and commodities will continue to increase as long as the buck falls.

More rate increases; Russia's central bank unexpectedly increased its benchmark interest rate for the second time this year to cap inflation in the world's biggest energy supplier.The bank increased the overnight deposit rate a quarter point to 3.25% and the overnight auction-based repurchase rate by the same amount to 5.5%. The inflation rate has been above the central bank's target of between 6 percent and 7 percent for this year since October, driven by rising food and fuel prices. The European Central Bank lifted interest rates this month for the first time in almost three years, while regulators in Brazil, India and China raised borrowing costs at least four times in the past year.