Friday, June 9, 2017

What's going on and why does it matter? The Congressional testimony of former FBI Director Comey didn't provide the smoking gun that some were looking for, and it's unclear whether it will impact the President's economic and legislative agenda. Mortgage bonds are nearly unchanged as global financial markets digest yesterday's events.  Overseas in the UK, Prime Minister May's Conservative Party lost its majority position in a stunning loss. The defeat will force the Prime Minister to cobble together a coalition government and is likely to make Brexit negotiations more difficult for her.  Financial markets don't seem to be having much of a reaction to the news. Mortgage bonds are continuing to trade above their 200-day moving average, and it will be interesting to see if they can stage a rebound off these levels. The Fed's mortgage bond buying activity today is limited to $625 million of 15-year conventional mortgages. What should you do about it? Watch for mortgage bonds to bounce higher off their 200-day moving average, but be prepared to lock your rate quickly if bonds fall back below this critical level of support. Economic reports that may impact mortgage rates this week: Date Report Period Prior Estimate Actual Mon 5 Jun Durable Goods (rev.) Apr -0.7% -1.2% -0.8% Mon 5 Jun Factory Orders Apr 0.5% -0.2% -0.2% Mon 5 Jun ISM Non-Mfg PMI May 57.5 57.0 56.9 Tue 6 Jun JOLTS Job Openings Apr 5.74M - 6.04M Thu 8 Jun Initial Jobless Claims Week of May 29 255,000 240,000 245,000 Fri 9 Jun Wholesale Inventory Apr 0.2% 0.2% Fri 9 Jun Wholesale Sales Apr 0.0% -