Rate Lock Advisory

Wednesday, November 26th

Wednesday’s bond market has opened in negative territory, taking back a good part yesterday’s late rally. Stocks are looking to head into the holiday on a positive note with the Dow up 196 points and the Nasdaq up 63 points. The bond market is currently down 7/32 (4.02%), but that afternoon strength yesterday should allow this morning’s mortgage rates to be slightly lower than Tuesday’s early pricing. The change this morning will depend on whether or not you saw an intraday improvement yesterday afternoon.

7/32

Bonds

30 yr - 4.02%

196

Dow

47,308

63

NASDAQ

23,089

Mortgage Rate Trend

Trailing 90 Days - National Average

  • 30 Year Fixed
  • 15 Year Fixed
  • 5/1 ARM

Indexes Affecting Rate Lock

Medium

Unknown

Treasury Auctions (5,7,10,20,30 year)

Yesterday’s 5-year Treasury Note auction drew a pretty strong demand from investors. The benchmarks indicated investor interest in the securities was stronger than other recent sales. The bond market didn’t show a strong reaction to the 1:00 PM ET results announcement, but this is common with short-term security sales. Bonds were able to hold their morning gains and made a small improvement before the auction results were available. The afternoon strength was enough for many lenders to issue a small intraday improvement in rates before closing. It also allows us to be optimistic about today’s 7-year Note auction since the term length is similar to yesterday. Another strong sale could lead to an improvement in rates before the end of the day.

Medium

Negative

Weekly Unemployment Claims (every Thursday)

The first of today’s three releases came at 8:30 AM ET when last week’s unemployment update was posted. It showed 216,000 new claims for jobless benefits were made last week, which was a decline from the previous week’s revised 222,000. Declining claims are an indication of strength in the employment sector. Therefore, this data is unfavorable for bonds and mortgage rates.

Medium

Negative

Durable Goods Orders

Next up was September's Durable Goods Orders report that revealed a 0.5% increase in new orders for big-ticket products like airplanes, appliances and electronics to match forecasts. A secondary reading that excludes more volatile and costly transportation-related orders (airplanes) rose 0.6% when analysts were expecting no change. Even though this data is known to be quite volatile from month to month, the increase in the secondary reading makes the data bad news for mortgage rates because it points to strength in the manufacturing sector.

Medium

Unknown

Fed Beige Book

We will also get the Federal Reserve's Beige Book report at 2:00 PM ET. This report is named simply after the color of its cover but details economic conditions throughout the U.S. by Fed region via their business contacts. Since the Fed uses this information during their FOMC meetings, its results can have a fairly big impact on the financial markets and mortgage rates if it reveals any surprises. Of particular interest is information regarding inflation, employment and consumer spending. If there is a reaction to the report, it will come during mid-afternoon trading.

Low

Unknown

Holiday Schedule

The U.S. financial markets will be closed tomorrow for the Thanksgiving Day holiday. Stocks and bonds are trading a full day today, but many traders are likely heading home early for the holiday weekend. There are early closes for both bonds and stocks Friday, meaning trading should be very light or thin between the holiday and the weekend. Since the markets are open, we will be updating this report Friday.

---

Unknown

none

We would like to take this opportunity to wish you and yours a safe and wonderful holiday!

Float / Lock Recommendation

If I were considering financing/refinancing a home, I would.... Lock if my closing was taking place within 7 days... Lock if my closing was taking place between 8 and 20 days... Lock if my closing was taking place between 21 and 60 days... Float if my closing was taking place over 60 days from now... This is only my opinion of what I would do if I were financing a home. It is only an opinion and cannot be guaranteed to be in the best interest of all/any other borrowers.

Abacus Mortgage & Loans

NMLS#225036

15188 NW Central Dr Ste 217
Portland, OR 97229-7804
Equal Housing Lender
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