Tuesday, December 3rd
Tuesday’s bond market has opened up slightly, extending gains from late yesterday. Stocks are showing early losses of 110 points in the Dow and 12 points in the Nasdaq. The bond market is currently up 2/32 (4.18%), which with yesterday’s afternoon gains should improve this morning’s mortgage rates by approximately .125 - .250 of a discount point. If you saw an intraday improvement yesterday, you may see slightly lower rates this morning.
2/32
Bonds
30 yr - 4.18%
110
Dow
44,671
12
NASDAQ
19,391
Trailing 90 Days - National Average
Medium
Unknown
There is no relevant economic data being released today, but tomorrow is a different story. November’s ADP private-sector Employment report will start the day’s batch of reports at 8:15 AM ET. It will give us data about the non-governmental portion of the employment sector. Since it does not come from a governmental agency, its impact on the bond market and mortgage rates is usually reduced unless the data shows significant surprises. Analysts are expecting to see 163,000 new jobs were added to the economy last month. A larger number would be bad news for rates while a much softer number should start the day with bond yields and mortgage pricing lower than this afternoon’s close.
Medium
Unknown
November's non-manufacturing index from the Institute for Supply Management (ISM) will follow at 10:00 AM ET. This is the sister release to yesterday’s manufacturing index, tracking executive sentiment about business conditions in the services sector instead of manufacturing. It is expected to show a reading of 55.5, down from October's 56.0, signaling fewer surveyed executives felt business improved in the sector than did in October. The lower the reading, the better the news for bonds and mortgage pricing.
Medium
Unknown
October's Factory Orders report is also set for release late tomorrow morning. It is similar to last week’s Durable Goods Orders report, except this version includes new orders for both durable and non-durable goods. It usually doesn't have a significant influence on bond trading since a good portion of the data has previously been made public. Favorable news would be a large decline because it would signal softer than expected manufacturing sector activity. Analysts are expecting a minor increase in new orders.
Medium
Unknown
The final event of the day will come during afternoon trading. The Federal Reserve will post their Beige Book at 2:00 PM ET. This report is named simply after the color of its cover but details economic conditions throughout the U.S. by Fed region via their business contacts. Since the Fed uses this info during their FOMC meetings, its results can have a fairly big impact on the financial markets and mortgage rates if it reveals any surprises. Of particular interest is information regarding inflation, employment and consumer spending. If there is a reaction to the report, it will come during mid-afternoon trading tomorrow.
If I were considering financing/refinancing a home, I would.... Lock if my closing was taking place within 7 days... Lock if my closing was taking place between 8 and 20 days... Float if my closing was taking place between 21 and 60 days... Float if my closing was taking place over 60 days from now... This is only my opinion of what I would do if I were financing a home. It is only an opinion and cannot be guaranteed to be in the best interest of all/any other borrowers.