Mortgage Rates Still Steady

Mortgage rates once again did not make much movement today.  The most prevalently quoted conforming 30yr fixed rate for best-case scenarios remains at 4.25%.    

Quiet again today but the 10yr yield has increased 1 bps to 2.55% and the Mortgage Backed Securities (MBS) were down just a little bit.  Weekly claims up more than expected but still low compared to earlier this year with low paying jobs getting markets way too excited -  nevertheless it is the market. April existing home sales were up 1.3% against estimates of +2.1%.  One of the drags this year and late last year has been the lack of supply, now with the country in warm weather more homeowners are listing their homes. More inventories are being seen as a harbinger of better housing in the months to come---we will see about that. It isn’t going to be long before interest rates increase - a view of increased housing will excite investors - maybe.  The gain in sales in April is the first one this year.  There was little reaction to the weaker home sales; tomorrow April new home sales carries a little more weight.  Watch the difference between single family sales versus multi-family sales.

China’s manufacturing index improved a little - the economy is still hurting but the better index read has stoked up a better outlook for China.

Ukraine is still in the headlines with the presidential election on Sunday. It is not as much of a concern now than it was six weeks ago - then investors were piling into treasuries and other sovereign debt, now with fighting escalating in Ukraine we don’t see any increase in the fear factor.

This is the dead zone for markets now. Tomorrow by 11:00 most traders will exit the building, many already have shut down to enjoy the first holiday of Summer. The bond market will close at 2:00, the stock market will trade its normal hours.

In summary, this was a light day for news as you may have guessed by now.