23 May Forever grateful to our service members!
Mortgage bonds poked their head above the support that has held them back for the past seven trading days. However, they were quickly pushed back below after they proved unable to muster the strength to make a decisive break above. At the same time, the S&P 500 is above the all-time closing high. It will be interesting to see if stocks are able to close as these record high levels, or if some dose of reality pushes stocks lower. Both stocks and bonds have been trading positive, which typically is an indication of low volume of mortgage bonds available in the market, or the stock market wanting so badly to keep pushing higher that it ignores the realities of current economic conditions.
New Home Sales were stronger than anticipated, coming in at 433,000 units. This is higher than last month’s 407,000, and also higher than the 420,000 expected. Overall, this wasn’t a bad number. Although this is the time when you expect an increase in new construction, the last few months’ reports somewhat spooked the market and lowered expectations. Hopefully this trend will continue and more new homes will be built as the summer months heat up.
The bond market will have an early start to this extended holiday weekend, closing at 12:00 p.m. MST today. Short days often create heavy volatility as the volume of transactions slows. This may wear on bond prices as the day drags on. As long as we remain positive, we will have a neutral locking bias.
We want to thank all of those who have served this amazing country. You are each heroes to us and we will be forever grateful for your contribution and sacrifice.