Friday, August 16, 2019

Daily Market Report 8/16/19

http://MikesDailyMarketReport.com:  Housing Starts dropped from 1.241 million in June to 1.191 million in July.  Even though this headline number shows a drop, the good news is if you dig deeper, then you'll understand that the drop was due to drop with Multi-Family.  There was actually an increase in Single Family, which is up approximately 2% YoY.  Building Permits, our Future Housing Starts, rose from 1.232 million in June to 1.336 million in July.  Consumer Sentiment dropped from 98.4 in July to 92.1 August.  Stocks are Up today, as the data from the Economic Calendar is spurring the positive movement today, as this week's volatility from the China aftermath and Inverted Yields are placed on the back-burner for now.  MBS is down 25bps from yesterday's close, so Mortgage Rates have worsened, but they're still Up from Wednesday's pricing.  Yields inched Up to 1.57% this morning.

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Thursday, August 15, 2019

Daily Market Report 8/15/19

http://MikesDailyMarketReport.com:  We have a lot of data on the Economic Calendar being released.  Initial Jobless Claims rose a little bit to 220k this week.  Retail Sales rose 0.7% in July; and when you exclude Autos, then it rose 1.0%.  Productivity rose 2.3% for Q2.  Unit Labor Costs rose 2.4% for Q2.  Empire State Index rose from 4.3 in July to 4.8 in August.  Philly Fed Index dropped from 21.8 to 16.8.  Industrial Production dropped 0.2% in July.  Capacity Utilization dropped from 77.8% to 77.5% in July.  Business Inventories remained Unchanged in June.  NAHB Home Builders Index rose from 65 to 66 in August.  For more clarification on this data, then please check out the video.  Stocks started the day off very volatile due to comments by China on Tariffs and Negotiations.  We saw swings to the low when they commented about Tariffs being placed in September to change of tone later in the day when they stated they'd like to accomplish a mutual beneficial agreement between the 2 nations.  Stocks are in Positive Territory, as Walmart reported bullish earnings, along with strong Retail Sales.  MBS is Up 31bps, so Mortgage Rates have improved from yesterday, and are about to pressure it's overhead ceiling of resistance.  Yields have continued to slide, which are currently sitting below it's 2nd floor of support.  It's currently at 1.534%  Next floor of support is 1.325%, which is the Yields All-Time Low.

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Wednesday, August 14, 2019

Daily Market Report 8/14/19

http://MikesDailyMarketReport.com:  There's no economic data to report today.  Stocks are being driven downward today (DOW down over 600 so far) on worries of the final Yield Curve Inversion.  The 2 year Yield finally inverted with the 10 year Yield.  This is important because it's been a very good indicator or signal that either we're in a recession or will be heading into a recession.  Again, this is not what causes a recession, but just an indicator or signal (so, not to be mistaken of what puts us into a recession).  This, coupled with more negative data from around the world, is spooking the Markets.  As a result, the MBS is Up 31bps, so we have improvement with our Mortgage Rate pricing; however, the Market did deteriorate a bit more yesterday afternoon, and there was a re-price for worse pricing.  Yields are testing it's first floor of support, and sits at 1.586% currently.

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Tuesday, August 13, 2019

Daily Market Report 8/13/19

http://MikesDailyMarketReport.com:  The NFIB Small Business Index, which measures the confidence for Small Businesses, rose from 103.3 in June to 104.7 in July.  The Consumer Price Index (CPI) rose 0.3% MoM in July, and 1.6% to 1.8% YoY.  However, if you remove the food and energy components (which are volatile), then you have the Core CPI.  The Core CPI rose 0.3% MoM in July and 2.1% to 2.2% YoY.  Stocks have reversed course and trading in Positive Territory (DOW is up over 400, thus far) on news that the US will either scrap altogether or just delay certain components of the $300 Billion Chinese Goods due to go into effect Sept. 1.  Also, the Trade Reps plan to be meeting again within the next 2 weeks.  Investors are closely watching the happenings in Hong Kong, as China is becoming more aggressive with their crackdown on Protestors.  MBS is currently down 9bps, however, that's not enough movement to change Mortgage Rates.  Yields have climbed to 1.68%.  Investors are watching the last possible inversion between the 2yr and 10yr, as they are now about 3bps from being inverted.

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Monday, August 12, 2019

Daily Market Report 8/12/19

http://MikesDailyMarketReport.com: Nothing to report on the Economic Calendar today.  Stocks are mostly following the news on US/China trade negotiations and Hong Kong.  The Yuan is getting weaker against the US Dollar, which the US has accused China of being a currency manipulator.  Also, tensions in Hong Kong continue to rise, as Police step up their tactics in a more aggressive manner, which is leading to bloodshed; as a result, the Hong Kong airport cancelled all flights because thousands of protestors are occupying the terminals.  MBS is currently Up 9bps and floating in mid-range of it's floor and ceiling.  Mortgage Rates remain Unchanged from Friday's Close.  Yields have fallen to 1.66% with it's next floor of support at 1.595%, which is the current Low point it reached about a week ago.

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Friday, August 9, 2019

Daily Market Report 8/9/19

http://MikesDailyMarketReport.com: The Producer Price Index rose 0.2% in July; however, it's YoY remained at 1.7%.  The Core PPI dropped 0.1% in July, and it's YoY dropped from 2.3% to 2.1%.  The Producer Price Index provides us insight to possible inflation to the Consumer, as it's inflationary data from the Wholesale sector.  This doesn't always get passed onto the Consumer, which is why it doesn't receive alot of attention.  Stocks are in the Red again this morning, as it faced a volatile week (big swings up and down).  Investors are still watching the US and China standoff in Trade negotiations, as China has cut purchases of Agriculture from the US; and US has been upholding US Businesses from conducting business with Huawei.  Italy wants to dissolve the parliament for new elections, so Investors are a bit jittery for any Italian Bond holdings.  MBS is currently down between 5-8bps.  Mortgage Rates had an intra-day price change yesterday afternoon and received better pricing; so, pricing this morning is better than yesterday morning's pricing, but the same as yesterday's close.  Yields are now sitting around 1.71%.

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Thursday, August 8, 2019

Daily Market Report 8/8/19

http://MikesDailyMarketReport.com: Weekly Jobless Claims dropped from 217k the prior week to 209k last week.  The Job Market still shows some strength.  Wholesale Inventories had 0.0% growth from May to June.  Stocks rebounded late yesterday and continued this trend this morning.  China repositioned their currency just above 7, which is a little stronger than reports yesterday at just below 7.  A poor Auction result for the 10 year Treasury Auction led to a drastic pullback to both Yields and MBS yesterday.  MBS is currently down about 2bps, so Mortgage Rates remain unnchanged from yesterday's close; however, we did have a price change for the worse yesterday; so, we're a little higher than yesterday morning.  Yields have risen to 1.77%.

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Wednesday, August 7, 2019

Daily Market Report 8/7/19

http://MikesDailyMarketReport.com: There's no economic data to report from the calendar today.  Global Yields are dropping like hotcakes!  Germany reports terrible economic data and reach historic lows with their Yields (-0.59%).  Central Banks from New Zealand, India and Thailand cut rates to keep up with the other Central Banks.  These moves are highlighted by China's response to Tariffs by manipulating their currency by devaluing it below 7.  Stocks are in a  freefall again today, as a result.  MBS is currently up 20bps, so Mortgage Rates continue the trend of Improvement.  Yields have dramatically dropped to 1.63% with no end in site.

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Friday, August 2, 2019

Daily Market Report 8/2/19

http://MikesDailyMarketReport.com: Today, we get the Big Jobs Data from the Bureau of Labor Statistics (BLS).  The Non-Farm Payroll reported 164k new jobs in July; however, there was a revision of -41k to the last 2 months of reports.  Also, the Unemployment Rate remained the same (3.7%) due to an increase in people entering the Labor Market.  Average Hourly Earnings rose by .3% in July.  Consumer Sentiment, also, remained unchanged at 98.4.  Factory Orders rebounded in June, as they rose 0.6% (vs. contracted by 1.3% in May).  Stocks are well in the Red, following yesterday's late reaction to President Trump's tweet on the 10% Tariffs on the remaining $300 Billion of Chinese Goods, which will go into effect on September 1st.  This has spooked Investors, as the both nations just returned back to the table this week; and are concerned this will heighten tensions between the nations.  On the other hand, it is reported that President Trump will announce a new deal that the  US will be exporting more beef to the EU.  MBS are near flat, +2 bps, as they had a very nice rally yesterday.  Mortgage Rates are better than yesterday morning and about the same as yesterday's close; so, depending upon the Lender, whether they added the afternoon's price improvement to yesterday or today, is what will determine if Mortgage Rates improved or not from yesterday's close.  Yields fell all the way down to 1.88%.

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Thursday, August 1, 2019

Daily Market Report 8/1/19

http://MikesDailyMarketReport.com: Initial Jobless Claims rose to 215k last week -still a very low number.  Remember, we have the BLS' Jobs data tomorrow!  ISM Manufacturing Index dipped from 51.7% to 51.2% in July.  Anything above 50% is considered in expansion territory on this index.  Construction Spending continued to slump, as it dropped 1.3% in June.  Stocks are trading in Positive Territory this morning, as the Fed had to backtrack on earlier comments regarding outlook for future rate decisions as this is a "mid-cycle adjustment"; whereas Investors took this comment as the Fed is One and Done with the Rate Cut.  It wasn't a very good comment to make, so he back tracked and basically expressed that any rate decision going forward will be data driven.  So, Investors may take this as any good news moving forward will mean bad news, as in the Fed won't cut rates any further due to good economic data.  The stocks closed above their lows, but still very low.  MBS closed yesterday off their highs, but are rebounding today, as they're Up 22bps, so Mortgage Rates have improved.  Yields are down to 1.96% and broke below it's 25 DMA and Fibonacci levels, further helping MBS and improvement to Mortgage Rates.

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