Monday, July 7, 2014 - Article by: Joe Shamie - First Choice Loan Services -
Monday - July 7, 2014, 11:05am ET
Current Trend Direction: Lower, stabilizing
Float/Lock Bias: Cautiously FloatingCurrent Price of FNMA 3.5% Bond: $102.12, +9bp
After last week's slide due to better than expected data culminating with a strong jobs report, Mortgage Bonds are trying to stabilize.
This week's economic calendar is light with just Weekly Initial Jobless Claims being reported on Thursday. But the markets will have Wednesdays release of the June FOMC minutes to trade on.
The Minutes should be interesting. Wage Growth is starting to perk up and that carries inflation concerns. We will also get to hear their thoughts on GDP after a very negative 1st Quarter reading.
Inflation and better economic conditions are reasons for the Fed to hike rates and this morning Goldman Sachs said the Fed will begin to raise the Fed Funds Rate in the 3rd quarter of 2015 instead of its original forecast of the first 3 months of 2016. Stocks didnt like this or any talk around taking the punch bowl away and as a result, are trading lower.
Technically, both the 25 and 50-day Moving Averages, which were once support, now become resistance. We are floating as Mortgage Bonds attempt to stabilize after Fridays Jobs Report hit.
Joe Shamie NMLS # 241432
First Choice Loan Services NMLS # 210764
First Choice Bank NMLS# 177877
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