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You are viewing Micro News from Thursday, Dec 19, 2013 - View all recent Micro News
  • 12/19/13
    Fannie Selling Guide Update: HPML Definitions, ATR Exceptions
    This Announcement describes selling policy updates that will be included in a future version of the Selling Guide. The effective date of each update is indicated below. The changes include:

    - Margin Thresholds

    - Definitions of Higher-Priced Mortgage Loan and Higher-Priced Covered Transaction

    - Exceptions to Ability to Repay Rule for Certain Transactions

    In addition, the following documents have also been (or will be) updated:

    -Fannie Mae Requirements for Document Custodians

    -Instructions to the Uniform Residential Loan Application (Form 1003)

    Here it is....
    Category: MBS, INDUSTRY
    Share:   
  • 12/19/13
    MBS Within an Eighth of Unchanged After Treasury Close
    While Treasuries continue to trade until 5pm, the unofficial close (marked by the end of the open outcry session at the CME) is 3pm. This also characteristically marks the end of the most active time of day for Treasuries and other fixed-income securities that trade in close proximity, like MBS.

    As such, we tend to take post 3pm movement with a grain of salt. Many bond market participants are done for the day after that. All that to say: MBS hit their best levels of the day heading into the 3pm close. That's positive.

    Less positive is the fact that 10yr yields didn't break back below the 2.92 technical level. This has come into play on several occasions in 2013 and was the first line of defense against yesterday's sell-off. While there's no epic implication of negativity, closing below would have been positive. Closing above leaves tension in the air going forward.

    Despite that tension, MBS have been happy just to get some stability. Today's entire move back toward unchanged levels has been made possible by Treasuries finding their footing at 9am. Several more lenders have joined in with positive reprices in the past few minutes, and it remains a possibility for any lender that hasn't gotten involved yet.
    Category: MBS, UPDATE
    Share:   
  • 12/19/13
    Check Out Claims Volatility [Chart]

    This makes it easier for traders to disregard this morning's big Jobless Claims miss. The series has been so uncommonly volatile that it simply can't be trusted in either direction.

    Jobless Claims Volatility

    Category: MBS, UPDATE
    Share:   
  • 12/19/13
    Off The Lows; Waiting on Auctions
    After some quick and fairly steep snowball selling this morning, bond markets have their feet underneath them to some small extent. MBS and Treasuries are still decidedly weaker on the day, but not as weak as they were.

    Fannie 4.0s are down 7 ticks (vs 14 earlier) to 102-27 and 10's are up just over 4bps (vs 7 earlier) to 2.9291. These levels are right in line with long term pivots, and the real risk is that 10's will treat this as a floor of resistance for the rest of the day. The period following the 7yr auction at 1pm is the only time we can really know how that's shaping up.
    Category: MBS, UPDATE
    Share:   
  • 12/19/13
    ECON: Philly Fed Index Slightly Weaker Than Expected
    - Business Conditions Index 7.0 vs 10.0 forecast
    - New Orders 15.4 vs 11.8 previously
    - Prices Paid 20.1 vs 29.9 previously
    - Employment 2.2 vs 1.1 previously
    - 6-month spending outlook 7.0 vs 17.2 previously

    Market Reaction: Possibly somewhat helpful inasmuch as it's not a strong number that suggests further selling. New Orders were up though, so the data is more 'mixed' despite the 'weaker' headline.

    Manufacturing growth in the region continued in December at a pace similar to that of November, according to firms responding to this month’s Business Outlook Survey. The survey’s broadest indicators for general activity, new orders, shipments, and employment were positive, signifying growth, and readings improved slightly in each category from November. The survey's indicators of future activity moderated slightly but continue to suggest general optimism about growth over the next six months.
    Category: MBS, ECON, INDUSTRY
    Share:   
  • 12/19/13
    ECON: Existing Home Sales Lower Than Expected
    - Existing Home Sales 4.9mln Annual Rate vs 5.03 Forecast
    - Median prices down to 196.3k from downwardly revised 197.5k in October

    - Markets Reaction: Almost undetectable improvement in bond markets. Really nothing to write home about yet.

    Existing-home sales fell in November, although median prices continue to show strong year-over-year growth, according to the National Association of Realtors®.

    Total existing-home sales, which are completed transactions that include single-family homes, townhomes, condominiums and co-ops, dropped 4.3 percent to a seasonally adjusted annual rate of 4.90 million in November from 5.12 million in October, and are 1.2 percent below the 4.96 million-unit pace in November 2012. This is the first time in 29 months that sales were below year-ago levels.

    Lawrence Yun, NAR chief economist, said the market is being squeezed. “Home sales are hurt by higher mortgage interest rates, constrained inventory and continuing tight credit,” he said. “There is a pent-up demand for both rental and owner-occupied housing as household formation will inevitably burst out, but the bottleneck is in limited housing supply, due to the slow recovery in new home construction. As such, rents are rising at the fastest pace in five years, while annual home prices are rising at the highest rate in eight years.”
    Category: MBS, ECON, INDUSTRY
    Share:   
  • 12/19/13
    Treasuries were calm overnight, holding a narrow range...
    MBS Updates are a service provided to MBS Live! subscribers only.
    Learn More | Start a Free Trial | View MBS Prices
    Category: MBS, alert
    Share:   
  • 12/19/13
    ECON: Jobless Claims Much Higher Than Expected
    - Jobless Claims 379k vs 334k forecast, 369k previous
    - Continued Claims 2.884m vs 2.78m forecast
    - Market Reaction: Almost none, due to large seasonal distortions.

    In the week ending December 14, the advance figure for seasonally adjusted initial claims was 379,000, an increase of 10,000 from the previous week's figure of 369,000. The 4-week moving average was 343,500, an increase of 13,250 from the previous week's revised average of 330,250.

    The advance seasonally adjusted insured unemployment rate was 2.2 percent for the week ending December 7, an increase of 0.1 percentage point from the prior week's unrevised rate. The advance number for seasonally adjusted insured unemployment during the week ending December 7 was 2,884,000, an increase of 94,000 from the preceding week's revised level of 2,790,000. The 4-week moving average was 2,799,000, an increase of 4,250 from the preceding week's revised average of 2,794,750.
    Category: MBS, ECON
    Share:   
  • 12/19/13
    Fannie Selling Guide Update: HPML Definitions, ATR Exceptions
    This Announcement describes selling policy updates that will be included in a future version of the Selling Guide. The effective date of each update is indicated below. The changes include:

    - Margin Thresholds

    - Definitions of Higher-Priced Mortgage Loan and Higher-Priced Covered Transaction

    - Exceptions to Ability to Repay Rule for Certain Transactions

    In addition, the following documents have also been (or will be) updated:

    -Fannie Mae Requirements for Document Custodians

    -Instructions to the Uniform Residential Loan Application (Form 1003)

    Here it is....
    Category: MBS, INDUSTRY
    Share:   
  • 12/19/13
    ECON: Philly Fed Index Slightly Weaker Than Expected
    - Business Conditions Index 7.0 vs 10.0 forecast
    - New Orders 15.4 vs 11.8 previously
    - Prices Paid 20.1 vs 29.9 previously
    - Employment 2.2 vs 1.1 previously
    - 6-month spending outlook 7.0 vs 17.2 previously

    Market Reaction: Possibly somewhat helpful inasmuch as it's not a strong number that suggests further selling. New Orders were up though, so the data is more 'mixed' despite the 'weaker' headline.

    Manufacturing growth in the region continued in December at a pace similar to that of November, according to firms responding to this month’s Business Outlook Survey. The survey’s broadest indicators for general activity, new orders, shipments, and employment were positive, signifying growth, and readings improved slightly in each category from November. The survey's indicators of future activity moderated slightly but continue to suggest general optimism about growth over the next six months.
    Category: MBS, ECON, INDUSTRY
    Share:   
  • 12/19/13
    ECON: Existing Home Sales Lower Than Expected
    - Existing Home Sales 4.9mln Annual Rate vs 5.03 Forecast
    - Median prices down to 196.3k from downwardly revised 197.5k in October

    - Markets Reaction: Almost undetectable improvement in bond markets. Really nothing to write home about yet.

    Existing-home sales fell in November, although median prices continue to show strong year-over-year growth, according to the National Association of Realtors®.

    Total existing-home sales, which are completed transactions that include single-family homes, townhomes, condominiums and co-ops, dropped 4.3 percent to a seasonally adjusted annual rate of 4.90 million in November from 5.12 million in October, and are 1.2 percent below the 4.96 million-unit pace in November 2012. This is the first time in 29 months that sales were below year-ago levels.

    Lawrence Yun, NAR chief economist, said the market is being squeezed. “Home sales are hurt by higher mortgage interest rates, constrained inventory and continuing tight credit,” he said. “There is a pent-up demand for both rental and owner-occupied housing as household formation will inevitably burst out, but the bottleneck is in limited housing supply, due to the slow recovery in new home construction. As such, rents are rising at the fastest pace in five years, while annual home prices are rising at the highest rate in eight years.”
    Category: MBS, ECON, INDUSTRY
    Share:   
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  • 12/19/13
    This Announcement describes selling policy updates that will be included in a future version of the Selling Guide. The effective date of each update is indicated below. The changes include:

    - Margin Thresholds

    - Definitions of Higher-Priced Mortgage Loan and Higher-Priced Covered Transaction

    - Exceptions to Ability to Repay Rule for Certain Transactions

    In addition, the following documents have also been (or will be) updated:

    -Fannie Mae Requirements for Document Custodians

    -Instructions to the Uniform Residential Loan Application (Form 1003)

    Here it is....
    Category: MBS, INDUSTRY
    Share:   
  • 12/19/13
    While Treasuries continue to trade until 5pm, the unofficial close (marked by the end of the open outcry session at the CME) is 3pm. This also characteristically marks the end of the most active time of day for Treasuries and other fixed-income securities that trade in close proximity, like MBS.

    As such, we tend to take post 3pm movement with a grain of salt. Many bond market participants are done for the day after that. All that to say: MBS hit their best levels of the day heading into the 3pm close. That's positive.

    Less positive is the fact that 10yr yields didn't break back below the 2.92 technical level. This has come into play on several occasions in 2013 and was the first line of defense against yesterday's sell-off. While there's no epic implication of negativity, closing below would have been positive. Closing above leaves tension in the air going forward.

    Despite that tension, MBS have been happy just to get some stability. Today's entire move back toward unchanged levels has been made possible by Treasuries finding their footing at 9am. Several more lenders have joined in with positive reprices in the past few minutes, and it remains a possibility for any lender that hasn't gotten involved yet.
    Category: MBS, UPDATE
    Share:   
  • 12/19/13

    This makes it easier for traders to disregard this morning's big Jobless Claims miss. The series has been so uncommonly volatile that it simply can't be trusted in either direction.

    Jobless Claims Volatility

    Category: MBS, UPDATE
    Share:   
  • 12/19/13
    After some quick and fairly steep snowball selling this morning, bond markets have their feet underneath them to some small extent. MBS and Treasuries are still decidedly weaker on the day, but not as weak as they were.

    Fannie 4.0s are down 7 ticks (vs 14 earlier) to 102-27 and 10's are up just over 4bps (vs 7 earlier) to 2.9291. These levels are right in line with long term pivots, and the real risk is that 10's will treat this as a floor of resistance for the rest of the day. The period following the 7yr auction at 1pm is the only time we can really know how that's shaping up.
    Category: MBS, UPDATE
    Share:   
  • 12/19/13
    - Business Conditions Index 7.0 vs 10.0 forecast
    - New Orders 15.4 vs 11.8 previously
    - Prices Paid 20.1 vs 29.9 previously
    - Employment 2.2 vs 1.1 previously
    - 6-month spending outlook 7.0 vs 17.2 previously

    Market Reaction: Possibly somewhat helpful inasmuch as it's not a strong number that suggests further selling. New Orders were up though, so the data is more 'mixed' despite the 'weaker' headline.

    Manufacturing growth in the region continued in December at a pace similar to that of November, according to firms responding to this month’s Business Outlook Survey. The survey’s broadest indicators for general activity, new orders, shipments, and employment were positive, signifying growth, and readings improved slightly in each category from November. The survey's indicators of future activity moderated slightly but continue to suggest general optimism about growth over the next six months.
    Category: MBS, ECON, INDUSTRY
    Share:   
  • 12/19/13
    - Existing Home Sales 4.9mln Annual Rate vs 5.03 Forecast
    - Median prices down to 196.3k from downwardly revised 197.5k in October

    - Markets Reaction: Almost undetectable improvement in bond markets. Really nothing to write home about yet.

    Existing-home sales fell in November, although median prices continue to show strong year-over-year growth, according to the National Association of Realtors®.

    Total existing-home sales, which are completed transactions that include single-family homes, townhomes, condominiums and co-ops, dropped 4.3 percent to a seasonally adjusted annual rate of 4.90 million in November from 5.12 million in October, and are 1.2 percent below the 4.96 million-unit pace in November 2012. This is the first time in 29 months that sales were below year-ago levels.

    Lawrence Yun, NAR chief economist, said the market is being squeezed. “Home sales are hurt by higher mortgage interest rates, constrained inventory and continuing tight credit,” he said. “There is a pent-up demand for both rental and owner-occupied housing as household formation will inevitably burst out, but the bottleneck is in limited housing supply, due to the slow recovery in new home construction. As such, rents are rising at the fastest pace in five years, while annual home prices are rising at the highest rate in eight years.”
    Category: MBS, ECON, INDUSTRY
    Share:   
  • 12/19/13
    Treasuries were calm overnight, holding a narrow range...
    MBS Updates are a service provided to MBS Live! subscribers only.
    Learn More | Start a Free Trial | View MBS Prices
    Category: MBS, alert
    Share:   
  • 12/19/13
    - Jobless Claims 379k vs 334k forecast, 369k previous
    - Continued Claims 2.884m vs 2.78m forecast
    - Market Reaction: Almost none, due to large seasonal distortions.

    In the week ending December 14, the advance figure for seasonally adjusted initial claims was 379,000, an increase of 10,000 from the previous week's figure of 369,000. The 4-week moving average was 343,500, an increase of 13,250 from the previous week's revised average of 330,250.

    The advance seasonally adjusted insured unemployment rate was 2.2 percent for the week ending December 7, an increase of 0.1 percentage point from the prior week's unrevised rate. The advance number for seasonally adjusted insured unemployment during the week ending December 7 was 2,884,000, an increase of 94,000 from the preceding week's revised level of 2,790,000. The 4-week moving average was 2,799,000, an increase of 4,250 from the preceding week's revised average of 2,794,750.
    Category: MBS, ECON
    Share:   
  • 12/19/13
    ECON: Philly Fed Index Slightly Weaker Than Expected
    - Business Conditions Index 7.0 vs 10.0 forecast
    - New Orders 15.4 vs 11.8 previously
    - Prices Paid 20.1 vs 29.9 previously
    - Employment 2.2 vs 1.1 previously
    - 6-month spending outlook 7.0 vs 17.2 previously

    Market Reaction: Possibly somewhat helpful inasmuch as it's not a strong number that suggests further selling. New Orders were up though, so the data is more 'mixed' despite the 'weaker' headline.

    Manufacturing growth in the region continued in December at a pace similar to that of November, according to firms responding to this month’s Business Outlook Survey. The survey’s broadest indicators for general activity, new orders, shipments, and employment were positive, signifying growth, and readings improved slightly in each category from November. The survey's indicators of future activity moderated slightly but continue to suggest general optimism about growth over the next six months.
    Category: MBS, ECON, INDUSTRY
    Share:   
  • 12/19/13
    ECON: Existing Home Sales Lower Than Expected
    - Existing Home Sales 4.9mln Annual Rate vs 5.03 Forecast
    - Median prices down to 196.3k from downwardly revised 197.5k in October

    - Markets Reaction: Almost undetectable improvement in bond markets. Really nothing to write home about yet.

    Existing-home sales fell in November, although median prices continue to show strong year-over-year growth, according to the National Association of Realtors®.

    Total existing-home sales, which are completed transactions that include single-family homes, townhomes, condominiums and co-ops, dropped 4.3 percent to a seasonally adjusted annual rate of 4.90 million in November from 5.12 million in October, and are 1.2 percent below the 4.96 million-unit pace in November 2012. This is the first time in 29 months that sales were below year-ago levels.

    Lawrence Yun, NAR chief economist, said the market is being squeezed. “Home sales are hurt by higher mortgage interest rates, constrained inventory and continuing tight credit,” he said. “There is a pent-up demand for both rental and owner-occupied housing as household formation will inevitably burst out, but the bottleneck is in limited housing supply, due to the slow recovery in new home construction. As such, rents are rising at the fastest pace in five years, while annual home prices are rising at the highest rate in eight years.”
    Category: MBS, ECON, INDUSTRY
    Share:   
  • 12/19/13
    ECON: Jobless Claims Much Higher Than Expected
    - Jobless Claims 379k vs 334k forecast, 369k previous
    - Continued Claims 2.884m vs 2.78m forecast
    - Market Reaction: Almost none, due to large seasonal distortions.

    In the week ending December 14, the advance figure for seasonally adjusted initial claims was 379,000, an increase of 10,000 from the previous week's figure of 369,000. The 4-week moving average was 343,500, an increase of 13,250 from the previous week's revised average of 330,250.

    The advance seasonally adjusted insured unemployment rate was 2.2 percent for the week ending December 7, an increase of 0.1 percentage point from the prior week's unrevised rate. The advance number for seasonally adjusted insured unemployment during the week ending December 7 was 2,884,000, an increase of 94,000 from the preceding week's revised level of 2,790,000. The 4-week moving average was 2,799,000, an increase of 4,250 from the preceding week's revised average of 2,794,750.
    Category: MBS, ECON
    Share:   
 
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