http://MikesDailyMarketReport.com: The Initial Jobless Claims came at 184k last week, which is a new Pandemic low (and lowest since 1968); however, a word of caution, as like every Holiday season, there are lots of Temporary jobs that are created until end of the year. This temporary position can distort the numbers somewhat. Continuing Claims bumped up about 40k from previous week. The Wholesale Inventories increased 2.3% MoM in October. Later today, there will be a 30 year Bond Auction, which could play a significant role with MBS' positions. Earlier in the week, the 10 year Treasury Auction went well, which MBS improved upon the news. Hopefully, the same will occur today. Unfortunately, tomorrow will be the CPI report, which may be the "wet blanket" for MBS, as it's expected to rise 0.7%. The November report came in high (0.9%), which MBS reacted negatively. Inflation erodes the value of bonds/MBS over time. Stocks are down today, which is helping MBS, as the investment dollars flow from equities to bonds. We do have some headline news, which are playing their parts today, but not really making too much impact. The first is the comments by Pfizer about the possible need for a 4th booster shot; and the second, is Fitch downgrading China's Evergrande credit, as they officially defaulted on some payments to their creditors. MBS is Up 9bps and in similar position as the last few days close periods; so, Mortgage Rate will be in line with the same pricing over past 3 days. We might see some improvement, if we can get a good 30 year Bond Auction later today. Most likely, we'll see a cap at the 25 DMA, which has been capping MBS for the past month. Meanwhile, Yields have slid back down to just under 1.49%.
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