Thursday, April 24, 2014 - Article by: Joe Shamie - First Choice Loan Services -
Thursday - April 24, 2014, 10:25am ET
Current Trend Direction: Sideways
Float/Lock Bias: Floating
Current Price of FNMA 4.0% Bond: $104.38, +16bp
Mortgage Bonds are trading higher and well off their worst levels after a mixed bag of economic data was released. Even strong earnings from social media giant Facebook coupled with a big share buyback increase and a 7 for 1 Stock split from Apple can't help to push Stock prices into positive territory.
The Labor Department reported that Weekly Initial Jobless Claims rose by 24K in the latest week to 329K, above the 312K that was expected to the highest level in 4 weeks. Durable Orders, or goods that are meant to last at least three years, rose by 2.6% in March, above the 2% expected.
You may notice that Treasuries are in negative territory and this is in anticipation of this afternoon's $29B 7-Year Note auction at 1:00pm ET. But yesterdays solid demand for the 5-Year paper could set the stage for another good showing today.
Technology, Technologythe CFPB released yesterday guidelines for an upcoming e-Closing pilot to assess how electronic closings can benefit consumers as they navigate the mortgage closing process. With all this regulation making the cost of doing business so expensive anything to streamline the process and remove costs is welcome. We have not seen all the new regulations put in place, and so far, while it may be protecting the consumer, it is definitely at a higher cost for borrowers.
Technically, the 4% coupon is trading up against resistance at the 50-day Moving Average, a level it failed to break above last week. We will continue to recommend carefully floating but watching for todays auction, in case the results disappoint.
Joe Shamie NMLS # 241432
First Choice Loan Services NMLS # 210764
First Choice Bank NMLS# 177877
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