Creating Wealth for my Family and Friends
Financial and Mortgage Bond Market Recap at close on Sept 17th, 2009
The data released this morning was seen as good until you look closer;
weekly jobless claims declined 12K against forecasts of an increase in new filings, but continuing claims, those who remain on unemployment increased to 6.23 mil frm 6.101 mil last week. August housing starts headline showed starts increased 1.5%, the highest level since Nov 2008, however most of the starts were in multi-family and not single family homes.
The Philly Fed business index was much stronger than expected on the headline, +14.1 frm +4.2 in August, market estimates were for an increase to 8.0; more under the rug, new orders component fell, and the employment component worsened. It took about two hours before the reality sank in that the headlines on the data this morning were not as strong as the headlines.
At 10:15 this morning mortgage prices were trading +3/32, by early afternoon prices moved to +15/32 with most all lenders re-pricing better. The 10 yr note yield once again tested and held support at 3.50%, at mid afternoon its yield backed down to 3.40%. With the recent movement of the 10 yr note we now have a well formed trading range for the note, between 3.50% and 3.28%. Likely moving back down now to test the low of the range. Mortgage rates are likely to break below 5.00% in the next week or so.
Treasury announced the details for next week's auctions; $43B of 2 yr notes, $40B of 5 yr notes and $29B of 7 yr notes. A total of $112B, $3B more than last month. The auctions are next Tuesday, Wednesday, and Thursday.
No more economic releases this week; tomorrow is the Jewish holiday, Rosh Hashanah; also quadruple witching with expirations on Sept stock indexes, bond and note futures contracts; at times the quarterly expirations can increase volatility.
Net worth for households and non-profit groups climbed to $53.1 trillion from $51.1 trillion in the first quarter, marking the first gain since the third quarter of 2007, according to the Federal Reserve's Flow of Funds. more signs that the recession has hit its worst and is now slowly, ever so slowly improving, it will however take years for consumers to fully recover. In the meantime consumers are reducing debt, saving more and hoping for hoe prices bottom and begin to turn up.
Just when we thought we had heard and seen most everything; now come pig farmers in China hoarding copper, of course pig farmers don't use copper, they want to buy and hold in another commodity speculation. Send in NY Atty general Cuomo to investigate and issue subpoenas to question those pig people and find out what they know and when did they know it. Better to have him over there instead of making a mess of the mortgage and real estate sales businesses.
PRICES @ 4:00 PM
10 yr note: 101.31 +24/32 3.38% -9 BP
5 yr note: 100.00 +11/32 2.38% -7 BP
2 Yr note: 100.03 +2/32 0.95% -4 BP
30 yr bond: 105.19 +55/32 4.17% -9 BP
Libor Rates: 1 mo 0.246%; 3 mo 0.291%; 6 mo 0.679%; 1 yr 1.291%
30 yr FNMA 4.5 Nov: 100.07 +16/32 (+13/32 frm 10:00)
15 yr FNMA 4.0 Nov: 100.29 +12/32 (+9/32 frm 10:00)
30 yr GNMA 4.5 Nov: 100.22 +12/32 (+14/32 frm 10:00)
15 yr GNMA 4.0 Nov: 101.10 +12/32 (+11/32 frm 10:00)
Dollar/Yen: 91.14 +0.28 yen
Dollar/Euro: $1.4729 +$0.0027
Gold Dec: $1016.40 -$3.80
Crude Oil Oct: $72.50 -$0.01
Goldman-Sachs
Commodity Index: 472.46 -0.54
DJIA: 9783.92 -7.79
NASDAQ: 2126.75 -6.40
S&P 500: 1065.48 -3.28
weekly jobless claims declined 12K against forecasts of an increase in new filings, but continuing claims, those who remain on unemployment increased to 6.23 mil frm 6.101 mil last week. August housing starts headline showed starts increased 1.5%, the highest level since Nov 2008, however most of the starts were in multi-family and not single family homes.
The Philly Fed business index was much stronger than expected on the headline, +14.1 frm +4.2 in August, market estimates were for an increase to 8.0; more under the rug, new orders component fell, and the employment component worsened. It took about two hours before the reality sank in that the headlines on the data this morning were not as strong as the headlines.
At 10:15 this morning mortgage prices were trading +3/32, by early afternoon prices moved to +15/32 with most all lenders re-pricing better. The 10 yr note yield once again tested and held support at 3.50%, at mid afternoon its yield backed down to 3.40%. With the recent movement of the 10 yr note we now have a well formed trading range for the note, between 3.50% and 3.28%. Likely moving back down now to test the low of the range. Mortgage rates are likely to break below 5.00% in the next week or so.
Treasury announced the details for next week's auctions; $43B of 2 yr notes, $40B of 5 yr notes and $29B of 7 yr notes. A total of $112B, $3B more than last month. The auctions are next Tuesday, Wednesday, and Thursday.
No more economic releases this week; tomorrow is the Jewish holiday, Rosh Hashanah; also quadruple witching with expirations on Sept stock indexes, bond and note futures contracts; at times the quarterly expirations can increase volatility.
Net worth for households and non-profit groups climbed to $53.1 trillion from $51.1 trillion in the first quarter, marking the first gain since the third quarter of 2007, according to the Federal Reserve's Flow of Funds. more signs that the recession has hit its worst and is now slowly, ever so slowly improving, it will however take years for consumers to fully recover. In the meantime consumers are reducing debt, saving more and hoping for hoe prices bottom and begin to turn up.
Just when we thought we had heard and seen most everything; now come pig farmers in China hoarding copper, of course pig farmers don't use copper, they want to buy and hold in another commodity speculation. Send in NY Atty general Cuomo to investigate and issue subpoenas to question those pig people and find out what they know and when did they know it. Better to have him over there instead of making a mess of the mortgage and real estate sales businesses.
PRICES @ 4:00 PM
10 yr note: 101.31 +24/32 3.38% -9 BP
5 yr note: 100.00 +11/32 2.38% -7 BP
2 Yr note: 100.03 +2/32 0.95% -4 BP
30 yr bond: 105.19 +55/32 4.17% -9 BP
Libor Rates: 1 mo 0.246%; 3 mo 0.291%; 6 mo 0.679%; 1 yr 1.291%
30 yr FNMA 4.5 Nov: 100.07 +16/32 (+13/32 frm 10:00)
15 yr FNMA 4.0 Nov: 100.29 +12/32 (+9/32 frm 10:00)
30 yr GNMA 4.5 Nov: 100.22 +12/32 (+14/32 frm 10:00)
15 yr GNMA 4.0 Nov: 101.10 +12/32 (+11/32 frm 10:00)
Dollar/Yen: 91.14 +0.28 yen
Dollar/Euro: $1.4729 +$0.0027
Gold Dec: $1016.40 -$3.80
Crude Oil Oct: $72.50 -$0.01
Goldman-Sachs
Commodity Index: 472.46 -0.54
DJIA: 9783.92 -7.79
NASDAQ: 2126.75 -6.40
S&P 500: 1065.48 -3.28
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