Thursday, May 12, 2022

Daily Market Report 5/12/22  The Initial Jobless Claims rose slightly from last week to 203k.  This is people applying for first time benefits.  The good news is that Continuing Claims has continued to decline.  The Producer Price Index (PPI), which measures Wholesale Inflation, rose only 0.5% in April.  This is after a big spike in March, which it rose 1.6%.  The Core PPI, which excludes food & energy, rose only  0.4% (beating out estimates of 0.6%), while it's YoY dropped from 9.6% in March to 8.8%.  Normally, this data doesn't get much respect, but due to inflation being the hot topic, the it's value has increased.  This report has given some investors and economist renewed hope that inflation has peaked; and hopefully, will get better.  Stocks are down again today, as they're still working their way thru the Fed policy road map.  This data didn't hurt MBS, as it has given investors a bit more hope regarding inflation.  Today, it has been a bit volatile, as we've seen it bounce back in highs and lows.  It's lows were equal to the same level as yesterday's close.  It's currently Up 38bps, so Lenders rate sheets have continued to show some improvement this week.  It's been awhile since we've had any improvement past 2 consecutive days; and now it's been 4 (if this continues).  However, MBS is approaching it's 25 DMA again, so we'll see if it can spring past it; or does it contain it(?)  Meanwhile, Yields have dipped below it's 25 DMA and sitting just under 2.83%.

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