Market Insider
Yesterday and first thing this morning treasuries were being hit hard and it looked like mortgage interest rates were going to start climbing up and then this:
April existing home sales, expected up 2.0%, fell 0.8% to 5.05 mil units frm 5.09 mil last month; the average sales price $163,700 down 5.0% frm April 2010. The shocker at 10:00, the May Philly Fed business index; it was widely expected at 20.0 frm 18.8 in April, as reported it fell to 3.9 a huge decline the lowest since Oct 2009. The new orders component at 5.4 frm 18.8 in Apr, prices pd at 48.3 frm 57.1 and the employment component at 22.1 frm 12.3 (any index over zero is considered expansion). The report is strange in that orders fell hard while employment increased. Finally at 10:00 April leading economic were expected +0.1% but was down 0.3% the first decline in that series since Feb 2009.
So now, the data stopped the selling and markets are improving. The 10 yr note cut its losses in half as have the mortgage markets. The DJIA and other key stock indexes took the data badly, the DJIA is generally unchanged at 10:10 after being up 60 points prior to the 10:00 data. Volatility will be high today after the very unexpected weak data reported. We will not change our outlook however, the bond and mortgage markets have likely seen their best levels.
Enjoy the ride!!
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