October 16th, 2020 12:28 PM by T. Fanning
Last Updated: 10/16/20Friday's bond market has opened in positive territory despite mixed economic news and early stock gains. The major stock indexes are looking to wrap up the week on a strong note, pushing the Dow up 220 points while the Nasdaq has gained 77 points. The bond market is currently up 2/32 (0.73%), but weakness late yesterday should cause a small increase in this morning's mortgage rates if comparing to Thursday's early pricing.This morning's major economic release was September's Retail Sales data at 8:30 AM ET. It showed that consumer level sales jumped 1.9% last month, greatly exceeding expectations. A secondary reading that excludes more volatile and costly auto transactions also came in well above forecasts. The higher readings indicate consumers spent more than thought last month. That means the data is bad news for bonds and mortgage rates since consumer spending equals almost 70% of the U.S. economy. Stronger economic conditions make bonds less appealing to investors.September's Industrial Production data was also released this morning, revealing a 0.6% decline in output at U.S. factories, mines and utilities. Since forecasts were calling for a 0.6% increase in production, we can consider this data favorable for bonds and mortgage pricing as it shows weakness in the manufacturing sector.Closing out this week's calendar was the University of Michigan's Index of Consumer Sentiment for October at 10:00 AM ET. It came in at 81.2, falling just short of forecasts but up slightly from September's 80.4. The increase is a sign that surveyed consumers are a little more likely to spend than last month. Because this is minor variance in a moderately important report, it has had no impact on this morning's rates.Next week has only a few economic reports scheduled that may influence mortgage rates but does bring in corporate earnings season that may have a heavy impact on stocks. The majority of the economic releases will focus on housing sector conditions. Monday has nothing of relevance scheduled, so expect weekend news and stock movement to drive trading as the new week opens. Look for details on all of next week's activities in Sunday evening's weekly preview.If I were considering financing/refinancing a home, I would....Lock if my closing were taking place within 7 days...Float if my closing were taking place between 8 and 20 days...Float if my closing were taking place between 21 and 60 days...Float if my closing were taking place over 60 days from now...This is only my opinion of what I would do if I was financing a home. It is only an opinion and cannot be guaranteed to be in the best interest of all/any other borrowers.**http://www.hlmcolorado.com/DailyRateAdvisory
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