MBS RECAP: Month-End Quells Volatility, but Keeps Bonds Green

Posted To: MBS Commentary

It's rare that I'll decide to include a chart with a shorter maturity yield curve constituent in the Day Ahead. In this morning's case, that happened to be the 3yr Treasury note, and 3's continued outperforming 10's and MBS today through the official 3pm close. In fact, the so-called “belly” (3, 5, and 7yr Treasuries) were the epicenter of month-end bond market strength , but fortunately, they were strong enough that 10's and MBS were able to come along for the ride. The yield curve levels (one Treasury yield minus another) between various maturities were the …read more

Mortgage Rates Inch Lower to End March; Volatility Ahead

Posted To: Mortgage Rate Watch

Mortgage rates fell again today extending a 3 day winning streak after shooting abruptly higher in the middle of last week. That damage hasn’t been completely undone yet, and we shouldn’t expect it to be, given that underlying trading levels in bond markets have yet to make it back to the stronger levels seen last Tuesday. In addition, it’s the nature of the mortgage market for rates to move up more abruptly than they move down. 3.75% remains the most prevalently-quoted conventional 30yr fixed rate for top tier scenarios. Most of the lenders that moved …read more

New Indicator says Housing is Healthy, Downturn unlikely

Posted To: MND NewsWire

Nationwide said on Tuesday that the overall housing market is healthier than at any time since 2001 , the earliest point for which data is available and that data suggests there is little reason to fear a national housing downturn over the next year. The insurance and financial services organization unveiled a new housing market indicator , the Leading Index of Health Housing Markets (LIHHM). The indicator’s national score as well as regional readings and breakdowns will be released quarterly in Nationwide’s Health of Housing Markets (HoHM) Report. (As an aside, we wonder if anyone at …read more

Update from MBA Tech Conference; What Percentage of Lenders is Testing TRID?

Posted To: Pipeline Press

Amelia Earhart was quoted as saying, “Never interrupt someone doing something you said couldn’t be done.” Few thought that the refi boom could have lasted this long, yet it is still alive. Sure refis are bound to taper off – that is a safe bet. But mortgage refinance share rose further in February according to Ellie Mae Origination Insight Report, jumping 8 percent to 59 percent of lenders’ loan volume, compared to 41 percent of purchase loans, down from 48 percent a month earlier. Conventional loans dominated the market at 69 percent in February, compared to …read more

Fewer Cities Bucking Flattening Home Price Trend

Posted To: MND NewsWire

Home prices flattened on a month-over-month basis in January even as annual prices continued to increase S&P Dow Jones Indices said today. The Case-Shiller indexes for national as well as selected metropolitan areas changed only minimally from December, partially attributable to usually cold and wet weather according to the S&P monthly report. The U.S. National Home Price Index declined for the fifth consecutive month, slipping 0.1 percent from December. Both the 10-City and 20-City Composite indexes were virtually flat with only nine of the cities reporting positive changes. Charlotte, Miami, and San Diego had the greatest …read more

MBS Day Ahead: Balancing Month-End Trading With Other Motivations

Posted To: MBS Commentary

Today is the last day of the month and quarter (or the fiscal year-end for many domestic entities or the entire nation of Japan). That makes the end of March a bit more eventfu l, historically, than the end of the other three quarters. Bond markets continue evaluating the normal set of motivations during this time, but they must now be balanced with the inherent tradeflow considerations that exist at month/quarter end. What does that mean? It sounds more complicated than it is . Imagine all the money parked and all the new money constantly being …read more

MBS RECAP: Another Quiet Session With a Narrow Range and Decent Gains

Posted To: MBS Commentary

For MBS, today was substantially similar to Friday, with a narrow but positive trading range and little fanfare surrounding any headline event. That's consistent with the expectation for the first two days of the week, which we've discussed in today's previous commentaries. Long story short: month/quarter end create an environment where compulsory tradeflows are just as much of a market mover as anything. This wouldn't necessarily be the case if heavier-hitting data was coming out today and tomorrow, but as it stands, there's nothing on the calendar that couldn't be overcome by determined tradeflow momentum. As …read more

Mortgage Rates Slightly Improved Over Weekend

Posted To: Mortgage Rate Watch

Mortgage rates fell moderately to begin the week, but haven’t yet returned to recent lows. Even so, the improvement is a relief considering rates had only just begun fighting back against a big move higher that happened on Wednesday and Thursday of last week. Friday then offered a glimmer of hope and today keeps hope alive. That said, upcoming events could make for some more volatility, especially after tomorrow. It’s not safe to assume that rates will continue to fall in the short term. 3.75% remains the most prevalently-quoted conventional 30yr fixed rate for top …read more

MBS MID-DAY: Holding Gains and Outperforming Treasuries

Posted To: MBS Commentary

The first two days of this week stand a good chance to see the momentum driven not by the events that transpire, but by the trades that must be made before tomorrow night, regardless of the data. Of course traders can choose the timing of those trades, and they can buy and sell in different combinations to achieve a desired result in some cases, but the bottom line is that month/quarter end is the biggest market mover at the moment. We've seen that play out so far this morning. The Incomes and Outlays data would have …read more

Pending Home Sales Signal Strong Spring Market

Posted To: MND NewsWire

Contract signings in the Midwest and South in February drove pending home sales to their highest level in nearly two years. The National Association of Realtors® (NAR) said today that its Pending Home Sales Index (PHSI) rose 3.1 percent in February to 106.9. The January index level, after a slight downward revision, was 103.7. The February number is 12.0 percent above the level in February 2014. According to NAR this is the sixth consecutive month that the index has increased compared to a year earlier and it has not been this high since June 2013 when …read more