Daily Market Report 6/28/19

http://MikesDailyMarketReport.com: A lot on the Economic Calendar today!  Starting off with the Personal Income for the month of May, which was up 0.5%; whereas, Consumer Spending was up 0.4% in May.  Personal Consumption Expenditure was Up 0.2%, as was the Core PCE (also called Core Inflation) Up 0.2%, for May.  However, the PCE's YoY dropped from 1.6% to 1.5%; and the Core PCE remained Unchanged at 1.6%.  The Fed has a target rate of 2.0%, so this is well below it's target rate.  Could be another reason for Fed to cut Rates in July.  Manufacturing contracted in the Chicago Region, as the Chicago PMI dropped from 54.2 to 49.7 in June.  The final number for the Consumer Sentiment rose from 97.9 in May to 98.2 in June.  Stocks are Trading in Positive Territory this morning, but it's light trading.  For the week, they may close Unchanged, similar to MBS.  Investors are waiting on the meeting of President Trump and President Xi, which is tomorrow.  Nobody expects a deal to be completed, but looking to see if US holds off on additional Tariffs and get back to the table.  MBS are mostly unchanged, as they are Up only 2bps, and Mortgage Rates remain Unchanged from yesterday's  pricing.  Yields are currently at 2.0%.

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Daily Market Report 6/27/19

http://MikesDailyMarketReport.com: Initial Jobless Claims rose to 227k this week, along with a revision of 1k to last week's numbers from 216k to 217k.  The Final Revision for the Q1 GDP remained at 3.1%.  It will be interesting to see what Q2 provides.  Q1 was a lot of build up of Inventories during the Tariff Talk and Q2 started with the Detente between US and China Negotiations.  So, it will be interesting to see how much of an impact it played.  Pending Home Sales improved for May, as it rebounded from April's decline of 1.5% to increase of 1.1%; the YoY improved from being down 2.0% to being down 0.7%.  Stocks started the morning in Mixed Territory and is now trading in Positive Territory.  Much of the impact came from some conflicting reports on the upcoming US and China meeting at the G20.  Boeing is also weighing on stocks, as it another design flaw was discovered, which will most likely delay their status of being grounded.  MBS is doing well today, as it's Up 14bps, so Mortgage Rates will show improvement on their pricing.  Yields have slid down to 2.02%, releasing pressure on MBS.

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Daily Market Report 6/26/19

http://MikesDailyMarketReport.com: Durable Goods Orders are still dragging, as Boeing's (737 Max) woes continue to bring down those numbers.  April's numbers were revised lower, as the revision led from -2.1% to -2.8%; and it declined 1.3% in May.  However, if you remove Transportation, then it improved from 0.0% in April to 0.3% in May.  Stocks are in a good mood today, as comments by Steven Mnuchin on CNBC were the US and China Negotiations are 90% completed.  However, that hasn't changed prior to the stall in the negotiations, as we were 90% completed at that point.  President Trump and Jinping plan to meet Saturday at the G20 Summit in Japan, as they discuss bridging the gap between the two nations.  As a result of the positive news for stocks, this is creating more pressure for MBS, as they are currently down 11bps.  This has resulted in a slight worse in pricing for Mortgage Rates.  Yields are clawing their way back to the (newly turned) Ceiling of Resistance at 2.03%.

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Daily Market Report 6/25/19

http://MikesDailyMarketReport.com:  A few items on the Economic Calendar to report this morning.  First up is the Case Shiller HPI for April.  Home Prices dropped from 3.7% YoY to 3.5% YoY.  Consumer Confidence Index dropped from 131.3 in May to 121.5 in June.  Much bigger than our forecast of 130.4.  Lastly, New Home Sales have slowed to it's lowest level since 2012.  It dropped from 679k annualized units in April to 626k in May.  Stocks are in the Red this morning ahead of several Fed Memebers Speaking Engagements, but notably one stands out, whom is Fed Chair Jerome Powell.  MBS is right up against it's Ceiling of Resistance, which is just Up 2bps from yesterday's close.  There's no change in pricing for Mortgage Rates.  Yields have slid down below it's Floor of Support to 1.99%.  It has a bit of room before it sees it's next Floor of Support, which will lessen pressure on MBS and quite possibly help propel it further Up, which will improve Mortgage Rates.

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Daily Market Report 6/24/19

http:MikesDailyMarketReport.com: The Economic Calendar is light today, so the Geo-Political will have the most affect on the Markets today.  Stocks are in Mixed Territory, as NASDAQ is currently in the Red.  Investors are looking ahead to the G20 Summit in Japan, which begins Friday, when it is expected that President Trump and Jinping will speak and hopefully work thru the detente in the Trade Negotiations.  Also, Investors are watching the US and Iran's tensions mount, as the US looks to increase sanctions on Iran.  Currently, the MBS is Up 11bps.  Not quite enough to improve Mortgage Rates from their disappointing end to Friday.  Yields are trying to fall below it's floor of support, after breaking above it Friday.  It's currently sitting just below the Fibonacci level at 2.01%.

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Daily Market Report 6/21/19

http://MikesDailyMarketReport.com: Both Manufacturing and Services Sectors are shrinking according to the Markit Flash PMI Indices.  The Markit Flash Manufacturing PMI dropped from 50.5 in May to 50.1 in June.  The Markit Flash Services PMI dropped from 50.9 in May to 50.7 in June.  Anything above 50 in these indices indicates expansion, so they're approaching a contraction level, if they continue this path.  However, we did get good news from the Housing Sector, which Existing Home Sales jumped Up from 5.19 million annualized units to 5.34 million in May.  This was a 2.5% Month-over-Month Increase; however, April was revised higer, so without the revision, the MoM would be closer to 3.0% improvement.  Stocks are trading in Mixed Territory.  S&P are down today, after it hit record territory yesterday, so it's taking a bit of a breather today.  A few members of the Fed are speaking, which reiterates the possibility of a rate cut coming in July.  However, this may turn into a possible debate of how much of a cut, .25% or .50%?  Investors are still optimistic that the US and China will return to the table to complete Trade negotiations.  Also, on the minds is the escalating tension between the US and Iran.  Iran is being blamed by the US for attacks on Oil Tankers passing by the Strait of Hormuz; and President Trump mentioned that he halted a last minute retaliatory strike against Iran for the missle strike on a US drone.  MBS is down 13bps, so Mortgage Rates are down from yesterday's pricing.  There was a price change (for the worse) late yesterday, as the MBS' rally deteriorated.  It is currently below the previous tough ceiling, but this is most likely a temporary situation, and I believe the rates will continue to improve.  Yields rose above it's previous tough floor of support, but again, I believe it will fall beneath this layer again.  It's currently sitting at 2.05%  If you are looking to refinance or buy a home, then please feel free to DM.  I can help with the financing.

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Daily Market Report 6/20/19

http://MikesDailyMarketReport.com: Initial Jobless Claims dropped from the previous week of 222k to 216k for this week's data.  This week's data is important becuase it is being used by the Bureau of Labor Statistic's (BLS) Job Numbers for June, which will be released on July 5th.  The lower number may result in a strong Jobs Number.  More data indicates that Manufacturing is slowing, as the Philly Fed Index (manufacturing in the Philadelphia region) has dropped from 16.6 to 0.3 in June (bordering on contraction).  Leading Indicators don't show any improvement in May (0.0%).  Stocks are following it's rally from yesterday, after the Fed's Announcement.  They received what they were expecting, which was to remove the "patient" from the language and indicated a more accomodative stance, as it will be expected for them to cut rates at the July Meeting.  The Bank of Japan and Bank of England continued the sentiments of the ECB and Fed, as they too will be more accomodative.  MBS had rallied after Fed Announcement yesterday (up 33bps) and continues today (Up 23bps), so Mortgage Rates have Improved.  If you check out the chart on the video, then we broke above the ceiling of resistance.  This breakout allows us more room for Mortgage Rates to continue improving (until next ceiling of resistance).  On the other hand, Yields have fallen below it's strong floor of support, and has broken below 2.0% for the first time in 2.5 years.  It is currently sitting at 1.98%.

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Daily Market Report 6/19/19

http://MikesDailyMarketReport.com:  Today is Fed Day!  The Fed wraps up it's 2 day meeting and will provide their decision around 11am PST today, so expect some Market Volatility.  All eyes are on the Fed today, as they await their decision.  The sentiment is the Fed will set the stage for a July Rate Cut and remove the word "patient" from it's language.  Investors will review the wording carefully and the Dot Plot, so they can see if the Fed may be thinking more than 1 Rate Cut this year.  Nothing else on the Economic Calendar today.  Stocks are currently trading in Mixed Territory, as the DOW is the only Index trading in Positive Territory.  President Trump tweeted yesterday that he had a phone conversation with Chinese President Jinping, which they'll have an "extended" meeting together at the G20 Meeting next week.  This was well received by Investors with hope of a conclusion to the Trade Negotiations between the 2 countries.  MBS is currently down 5bps, so Mortgage Rates remain Unchanged from yesterday's Interest Rates.  Yields are clawing their way back above the Floor of Support at 2.09%.

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Daily Market Report 6/18/19

http://MikesDailyMarketReport.com: Housing Starts came in at 1.27 million annualized units for May compared to a revised (higher) 1.29 million annualized units in April.  The revision shows it dropped; but without the revision, it would have rose.  Building Permits remained unchanged from April to May at 1.29 million annualized units.  The Fed begins their 2 day meeting today, which it is expected to set up next month's meeting for a possible rate cut.  Stocks are really taking off (DOW is currently up 400 points), as comments by ECB's Mario Draghi stoke the fire.  He reiterated his desire to cut rates further to jumpstart the EU Economy and further reduce their Yields into deeper Negative Territory (Deutsche Bund is now -.313%).  This is lowering Yields on a Global Level, even pushing our Yields below it's Floor of Support.  The ECB's comments will add more pressure to the Fed to cut it's rates.  MBS is Up 9bps, after touching 20bps earlier this morning.  I'd say that Pricing got better back East, but on the West Coast, Pricing Remained the same, as those gains shrunk by the time they opened.  Yields are down to 2.06%.

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Daily Market Report 6/17/19

http://MikesDailyMarketReport.com: Manufacturing in the NY region had one of it's worst declines in June, according to the Empire State Index, which went from 17.8 in May to -8.6 in June.  Also, confidence is starting to wane with Home Builders, as the NAHB Home Builder Index, which is a survey to gauge their confidence dropped from 66 to 64; however, any reading above 50 is considered optimism.  Stocks are trading in Positive Territory, as i'ts preparing for the FOMC.  A few Economists are calling for a Rate Cut at this coming meeting, but the odds are around 27% for such an occurence.  Most, around 87%, are projecting a Rate Cut for July's Meeting.  The sentiment is the Fed wants to be transparent and set the stage for a Cut.  If they cut at this meeting, then it may be viewed as an Emergency or Crisis and spook the Markets.  Investors will review the Dot Plot to see how many Cuts may happen this year, as some are calling for 2 Cuts; as well as, some change in the Fed's language.  Stocks are also being led by a few major players, like Sotheby's possible acquisition to be Private; and Facebook's upcoming release of it's own Crypto Currency.  MBS is down 6bps, which is not quite enough for Mortgage Rates to worsen, so Interest Rates remain Unchanged.  Yields are still hovering the low end of it's Trade line and sitting at 2.09%.

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Daily Market Report 6/14/19

http://MikesDailyMarketReport.com: There's a lot of data on the Economic Calendar to report today.  We'll start with the Retail Sales and Retail Sales without Autos for May, which were both up 0.5%.  This was on the heels of a positive revision the previous month for both data points.  Industrial Production rose 0.4% in May.  Capacity Utilization rose from 77.9% to 78.1% in May.  However, Consumer Sentiment dropped from 100 to 97.9 in June.  It's final number will be toward the end of the month, so we'll see if the Consumer is feeling less enthused continues for the whole month.  Business Inventories rose 0.5% in April.  Stocks are down, even though we have relatively good economic data being reported, however, the Geo-Political news is taking more of a command of the Markets today.  China reported some more disappointing Economic data, which  is reminder to the Investors on an Global Economic slowdown.  Iran is denying any part in the recent Tanker attacks.  Oil prices are higher, which neither the Stock, nor Bond likes the news of higher Oil prices.  Of course, there are concerns that this could result in more tensions, and possibly with Military involvement.  Broadcom has lowered their expectations for the year, which is being attributed to the impasse between the US and China.  This is affecting the rest of the High Tech sector.  MBS is currently down 6bps, so Mortgage Rates remain Unchanged.  Yields have slid down to the 2.08% range and is testing the floor of support, which is important to Yields.  If this breaks, then Mortgage Rates can continue to improve off these current rates.

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Daily Market Report 6/13/19

http://MikesDailyMarketReport.com: Initial Jobless Claims rose 3k from the previous week's numbers, going from 219k to 222k.  However, the previous week's numbers were revised higher by 1k (218k to 219k).  Stocks are trading in Positive Territory this morning.  There was a more positive tone today, as President Trump indicated that there was no timetable on any further Tariffs with China, and a deal could happen.  Oil is rising a bit this morning on news that a few tankers were attacked at the Gulf of Oman.  Iran is suspected in these attacks, as there are growing tensions between US and Iran.  MBS is only Up 2bps, so there's no change in Mortgage Rates today.  Yields remain at 2.12%, as well.

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Daily Market Report 6/12/19

http://MikesDailyMarketReport.com: The Consumer Priced Index rose only 0.1% in May, which it's YoY dropped from 2.0% to 1.8%.  The Core CPI (excluding food and energy) also rose only 0.1%.  It's YoY dropped from 2.1% to 2.0%.  Stocks are trading in Negative Territory, despite the lower Consumer Inflation data, as Investors continue to watch the drama between the US and China' Trade Talks.  President Trump recently tweeted that he's holding up the talks, and his sentiment is that the deal should be great for both US and China, otherwise, there's no sense in making an agreement.  This is souring the Markets a bit.  Also, there are Mass Protests in Hong Kong over recent laws that will allow China to extradite from Hong Kong to the mainland.  This isn't sitting well with the people of Hong Kong.  MBS is Up 9bps, but Mortgage Rates remain Unchanged.  Yields are currently at 2.12%.

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Daily Market Report 6/11/19

http://MikesDailyMarketReport.com: NFIB Small Business, which measures the confidence among Small Businesses, rose from 103.5 in April to 105.0 in May.  Producer Priced Index, which measures inflation on the Wholesale sector, rose 0.1% in May.  However, it's YoY dropped from 2.2% to 1.8%, further illustrating that inflation is still fairly tame.  Stocks are trading in Positive Territory this morning, as China plans a new Stimulus project aimed to re-build it's infracture within it's local municipalities and is issuing Bonds for this project.  MBS are Up 3bps, so Mortgage Rates remain Unchanged from yesterday's pricing.  Yields are now at 2.15%.

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Daily Market Report 6/10/19

http://MikesDailyMarketReport.com: Nothing to report on the Economic Calendar today.  Stocks are Up this morning after it was announced over the weekend that the US and Mexico reached an agreement over the migration issue, so the US will not impose sanctions.  Steven Mnuchin and PBC's Yi Gang had reportedly very candid and constructive talks while at the G20 meeting.  Reports came out of China that their Exports rose slightly and their imports dropped sharply.  MBS is Down 19bps, so Mortgage Rates rose slightly.  Yields rose to 2.14%.

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Daily Market Report 6/7/19

http://MikesDailyMarketReport.com: Nonfarm Payroll really disappointed in May, as only 75k new jobs were created.  Also, there were revisions from the previous 2 months, which were lowered by 75k combined.  Unemployment remained unchanged at 3.6%.  Average Hourly Earnings rose 0.2% in May.  Wholesale Inventories rose 0.8% in April.  Stocks are trading in Positive Territory, as today's Bad News (in terms of disappointing Job Numbers) is feeling like Good News because the sentiment is the Fed will cut Interest Rates sooner than later (possibly this summer).  There's been some progress made on the talks with Mexico to help curb the influx of people trying to cross the US Borders.  Not sure if it's enough progress for President Trump to halt the Tariffs on Monday.  Not much has been changed between US and China.  The People's Bank of China was commented that they have enough tools to be able to stimulate their economy even during a Trade Spat with the US.  MBS is Up 17bps, so Mortgage Rates Improved today.  Yields continue their decline, as they reach 2.07%.

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Daily Market Report 6/6/19

http://MikesDailyMarketReport.com:  Initial Jobless Claims rose this week from 215k from previous week to 218k.  These are still low numbers, which is why Investors shrugged off the ADP number yesterday.  They're anticipating approximately 190k new jobs for tomorrow's BLS' report.  Q1 Productivity was revised a bit lower, from 3.6% to 3.4%.  Unit Labor Costs (Q1) was revised further declines from -0.9% to -1.6%.  This can help keep inflation low.  Stocks have shifted into Negative Territory this morning, as the Market Sentiment became more risk aversed due to the Dovish Speak with Central Speakers and US' Trade Talks with Mexico and China.  The ECB held their rate at -0.4% and pledged to maintain that rate for 2019.  Earlier this week, US Fed Members also had a dovish tone to their speeches, which many are led to believe a rate hike will come.  President Trump is ready to add Tariffs to Mexico on Monday, as he stated the Talks haven't progressed enough to warrant a halt to the Tariffs.  Also, it is believed that the US will carry out the Tariffs on China's remaining $300 Billion Goods after G20 Meeting at the end of June (the 29th).  MBS is Up 5bps, but Mortgage Rates remain Unchanged from yesterday's pricing.  Yields are now at 2.10%.

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Daily Market Report 6/5/19

http://MikesDailyMarketReport.com:  ADP Employment number really missed it's mark in May.  It went from 271k new private jobs in April to only creating 27k in May.  This didn't weigh on the Market too much, as the ADP's number doesn't always translate to the same as the BLS'.  Most think the BLS' numbers on Friday will be around 190k due to the low Jobless Claims during May.  The Service Industry is still humming along.  We have 2 reports on this sector.  First is the Markit Services PMI, which remained Unchanged at 50.9 in May; the other is ISM Non-Manufacturing Index, which rose from 55.5% to 56.9%.  Around 11:15am PST, the Fed will release it's Fed Beige Book, which will provide insight into the Micro Economics of the various Fed Regions across the US.  Stocks are continuing their rally today, as the Sentiment has changed.  Investors feel that the Fed may cut rates sometime in the near future to stimulate the economy that may be slowing due to the tariffs; along with optimism that reps from both China and US may ease the tensions from previous talks and resume those negotiations.  MBS is currently Unchanged from yesterday's closed, but MBS did drop further on the Equities rally yesterday, so some Lenders (pending when they released their pricing) may either provide worse pricing, or the same pricing, as yesterday's.  Those whom kept the same pricing, may have changed their pricing yesterday for the worse, so it kind of offsets itself.  Yields are currently at 2.11%.

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Daily Market Report 6/4/19

http://MikesDailyMarketReport.com: Factory Orders dropped 0.8% in April.  Starting tomorrow, we'll look at the Job Numbers for May, which begin with the ADP numbers, then Weekly Jobless Claims on Thursday and BLS' Unemployment Rate and Jobs data.  Stocks are rebounding after yesterday's Negative Close.  Investors are watching the 4 biggest Tech Companies stave off tougher regulations, as the US Gov't aims to go after them with Anti Trust suits.  Some optimism developed, as reports out of China seem to indicate that they'd like to work out the differences by resuming talks.  Fed Members Bullard and Powell touch on the possibility of the Fed cutting rates as soon as this year.  Their 7/31 meeting has a 59% probability.  MBS is currently down 11bps.  We had a mid-day price improvement yesterday, but if you remove that price improvement yesterday, then our Mortgage Rates will remain Unchanged from the Morning's pricing.  Yields remain at 2.12%.

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Daily Market Report 6/3/19

http://MikesDailyMarketReport.com: Overall Manufacturing dipped in May.  The Markit Manufacturing PMI dropped from 50.6 to 50.5; whereas, ISM Manufacturing Index dropped from 52.8% to 52.1%.  These are the lowest levels we've seen in approximately the past 20 months.  Construction Spending was revised from -0.9% to -1.7% in March; and April's numbers were almost identical to the revised numbers in March, so it was flat.  Stocks are trading in Mixed Territory.  NASDAQ is down because of the Anti Trust concerns with Google.  President Trump landed in London today.  Tariffs may go up again for Mexico within the next week to two, if there's no progress on the slowdown of illegal border crossings.  Also, China sent over their list of demands to the US, whom they blame for the break in talks, which include removing tariffs on some specific goods.  The tariff talk coupled with some of the lower macro economic data has led to a deeper Inverted Yield Curve, which concerns Investors, as this has been a precursor to past recessions.  MBS is Up 2bps, but Friday, it closed strong, which will lead to better pricing for Mortgage Rates today.  Yields continue their slide, per the concerns by investors with the deeper inverted Yield Curve, and are currently at 2.12%.

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