Last Updated: 12/21/2007

Friday's bond market has opened in negative territory following the release of stronger than expected economic news and sizable stock market gains. Stocks are rallying this morning with the Dow up 166 points and the Nasdaq up 33 points. The bond market is currently down 15/32, which will likely push this morning's mortgage rates higher by approximately .250 of a discount point over yesterday's morning rates. November's Personal Income and Outlays report was released early this morning. It showed that personal income rose 0.4% last month. This was slightly lower than the 0.5% that was expected. However, the bad news came in the outlays or spending portion of the report. It revealed a 1.1% jump that was well above forecasts of a 0.7% rise. That means that consumers were spending more than thought and since consumer spending makes up two-thirds of the U.S. economy, this was bad news for bonds and mortgage rates.