Weekly Market Commentary: Mortgage bond prices finished the week higher which helped mortgage interest rates fall. Rates were relatively calm the first portion of the week with no data. Trading was choppy Wednesday afternoon as traders positioned ahead of the data releases Thursday. Weekly jobless claims came in @ 326k versus the expected 327k Thursday morning. The data was relatively in line with expectations and mortgage rates recovered the losses from Wednesday. Existing home sales came in at 4.87m versus the expected 4.89m mark. Leading economic indicators rose 0.1% versus the expected 0.2% increase. Overall the data was rate friendly. Mortgage interest rates finished the week better by approximately 1/4 of a discount point. Taper Talk Continues Market participants will again focus on the Federal Reserve and reductions in asset purchases this week. The Fed tapered mortgage-backed security purchases in January and many analysts anticipate another taper announcement from their meeting Wednesday. Most of the recent data supports another taper but the weak payrolls component of the employment report this month and some recent stock weakness add additional uncertainty. The reaction to the last taper announcement caused mortgage interest rates to spike higher in the short term. It is very possible we could see a repeat this week. Floating in this environment has risks. Now is a great time to take advantage of rates.
Posted on: Fri, 24 Jan 2014 21:03:44 +0000
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