Mortgage Market Update
Monday’s bond market has opened slightly in negative territory with stocks flat and not much to drive trading this morning. The major stock indexes are near Friday’s closing levels with the Dow 2 points and the Nasdaq up 7 points. The bond market is currently down 3/32, which should push this morning’s mortgage rates higher by approximately .125 of a discount point over Friday’s morning pricing. There is nothing scheduled for release today that is expected to influence mortgage rates. If we see an intraday revision to rates, it will likely come as a result from a noticeable move in stocks. The rest of this holiday-shortened week brings us the release of only four pieces of relevant economic data that may influence, but two of them are considered to be highly important. In addition to a speech by Fed Chair Janet Yellen, we also have the Independence Day holiday that will shorten our week by a day and some. Tomorrow has one of the week’s key economic reports that are likely to cause movement in the markets and possibly mortgage rates. The Institute of Supply Management (ISM) will post their manufacturing index for June at 10:00 AM ET tomorrow. This index measures manufacturer sentiment by surveying trade executives on current business conditions. May's reading that was posted last month came in at 55.4. A reading below 50 means that more surveyed executives felt business worsened during the month than those who felt it had improved. Analysts are expecting a reading of 55.8, indicating slight improvement in manufacturer sentiment. Good news for the bond market and mortgage rates would be a decline in the index, signaling worsening conditions in the manufacturing sector. Overall, I am expecting to see another fairly active week for the financial markets and mortgage rates. The most important day of the week is Thursday due to the monthly Employment report and early closing ahead of the holiday, but tomorrow and Wednesday may also bring a noticeable move in rates.