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Rising Rate Trend Changing Course or Just Leveling Off?
After a modest day of gains on Friday, bonds covered some more serious ground today. 10yr yields were more than 4bps lower at the 3pm CME close, and roughly 8bps lower versus Friday's highs. Does this mean the prevailing negative trend is reversing? Or are we simply taking a break while bonds wait for more info?
Econ Data / Events
20min of Fed 30yr UMBS Buying 10am, 1130am (M-F) and 1pm (T-Th)
New Home Sales 959k vs 1.025m f'cast, 994k prev
Market Movement Recap
08:19 AM Bonds were stronger out of the gate in Asia, largely following weakness in the stock market. Similar correlation hit once again at the start of the European session where 10yr yields (and stocks) hit their lows together shortly after the European open. Both have been inching back toward higher levels since then, but S&P futures are still down 1% on the day and 10yr yields are down 2.85bps at .812. MBS are starting the day up almost an eighth of a point.
01:32 PM Rallying fairly well into the PM hours, mostly following a rather large selling spree in stocks (S&P futures down 2.55% on the day). 10yr yields are down 4.5bps to .796 and 2.0 UMBS are up 5 ticks (.16) now at 103-04 (103.125).
03:22 PM Stocks lost almost 1% between 11:15am and the lows of the day at 1:30pm. Contrast that with the bond market where 10yr yields were .79% on both occasions. That builds a case for today's resilience meeting resistance at the .79% technical level. MBS are up an eighth of a point, just a bit off their mid-day highs, but by no means in distress.
MBS Commentary
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Rising Rate Trend Changing Course or Just Leveling Off?
After a modest day of gains on Friday, bonds covered some more serious ground today. 10yr yields were more than 4bps lower at the 3pm CME close, a... (read more)
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Housing News
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New home sales declined in September for the first time since April. The U.S. Census Bureau and the Department of Housing and Urban Development said sales of newly constructed homes were sold at a seasonally adjusted annual rate of 959,000 units, a 3... (read more)
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Housing News
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The number of serious delinquencies dropped in September according to Black Knight. The 43,000 decline in the number of loans that were 90 or more days past due marked the first improvement in that statistic since the start of the pandemic. The chang... (read more)
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Rob Chrisman
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The most reliable way to forecast the future is to try to understand the present. Vendor M&A is rampant (the latest being First American acquiring ServiceMac ). Although there is no way that the “experts” could have predicted the comb... (read more)
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Mortgage Rate Watch
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Another week, another glut of news articles claiming mortgage rates are at all-time lows. While no one is intentionally trying to deceive you, the news is deceptive nonetheless. Why? Freddie Mac's weekly mortgage rate survey is at the heart of the is... (read more)
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Housing News
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The contribution made to household wealth by homeownership is underlined in ATTOM Data Solutions' third-quarter U.S. Home Sales Report . The company said that a typical homeowner who sold a home during the quarter had a gain of $85,000 . This was $10... (read more)
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