Daily Market Update 3/31/10

Mortgage rates held steady Wednesday on mixed economic data. The Chicago Purchasing Managers Index declined more than expected to 58.8 from 62.6 last month. Meanwhile, Factory Orders increased 0.6% in February, beating forecast. The Mortgage Bankers Association weekly purchase activity index rose 6.8%, while the refinancing activity index fell 1.3%. No other data will be released today.

Daily Market Update 3/30/10

Mortgage rates inched higher Tuesday as the yield spread between mortgage-backed securities (MBS) and Treasuries increased. The Fed will end its $1.25 trillion MBS purchase program tomorrow, which has been credited with holding mortgage rates down for the past 16 months. In economic news, the Conference Board reported Consumer Confidence rose to 52.5 in March from 46.4 in February, beating expectations. Stock moved higher. No other data will be released today.

Daily Market Update 3/29/10

Mortgage rates were little changed Monday. February Personal Income was flat from January, which was slightly below forecast. The February Core PCE price index also was unchanged, and increased at a tame 1.3% annual rate, indicating inflation is not a concern in the near term. Consumer Spending rose 0.3%, matching expectations. No other data will be released today.

Daily Market Update 3/26/10

Rates were little changed Friday. Mortgage-backed securities (MBS) came under pressure this week following three consecutive days of poor auction results for US Treasuries, beginning Tuesday. This morning, former Federal Reserve Chairman Alan Greenspan called the recent rise in Treasury yields a "canary in the mine", saying investors are concerned about "this huge overhang of federal debt which we have never seen before". In economic news, fourth Quarter GDP was revised down to +5.6%, a bit below expectations. Consumer Sentiment was unchanged in March. Stocks moved higher. Next week will be extremely busy in terms of key economic data. Core PCE, the Fed's preferred measure of inflation, will be released Monday, the Chicago Purchasing Managers Index will come out Tuesday, the Institute for Supply Management manufacturing index on Thursday, and the closely-watched Non-farm Payrolls report for March will be released Friday. MBS markets may be unusually volatile. No other data will be released today.

Daily Market Update 3/25/10

Rates moved higher yesterday afternoon, triggered by poor Treasury auction results, and have now risen by about 1/4% for the week. The sharp sell-off in mortgage-backed securities (MBS) reflects global concerns for bonds, in general, on the downgrading of Portuguese debt. Buyers are also demanding higher yields as the Fed ends their MBS purchase program next week. Fed Chairman Ben Bernanke speaks today about the Fed's exit strategy from the MBS purchase program. Investors will be closely watching today's Treasury auction of 7-year notes. In economic news, weekly Jobless Claims fell to 442,000, below the consensus forecast of 450,000.

Daily Market Update 3/24/10

Rates moved higher Wednesday ahead of this afternoon's record-tying $42 billion Treasury auction of 5-year notes. In economic news, Durable Goods Orders rose 0.5% in February, close to forecast. Outside of the auto sector, strength was seen in most areas, hurting mortgage-backed securities. Stocks were mostly lower, the dollar higher. No other data will be released today.

Daily Market Update 3/23/10

Mortgage rates inched lower Tuesday as Existing Home Sales declined for the third straight month in February. In testimony before the House Financial Services Committee, Treasury Secretary Timothy Geithner called for an overhaul of the housing finance system. Congress is considering what to do about Fannie Mae and Freddie Mac in response to the taxpayer bailouts of the two agencies. "Private gains can no longer be supported by the umbrella of public protection, capital standards must be higher and excessive risk-taking must be appropriately restrained" said Geithner. No other economic data will be released today. The Treasury will announce the results of its auction of 2-year notes at 1:00 PM.