Great opportunity to lock in

Global stock markets continue to recover from their losses following the historic “Brexit” vote. In fact, London’s FTSE 100 has recovered all of its losses since last Thursday’s referendum. However, the FTSE 250, which is considered to be a better barometer of the British economy, is still down nearly 8%. Here in the US, stock markets are back within range of pre-Brexit trading. Many investors feel that economic events happening in Europe aren’t going to stop the US consumer from purchasing homes or other goods and services here at home. This optimism should be taken with a grain of salt, as such a significant global event does have the power to impact the US economy over time.


Mortgage bonds experienced a sell-off in late trading yesterday, as bond investors realized the strength of global stock markets was real. However, bonds held their floor of support and made a bounce higher this morning. They are now trading in a tight sideways channel that is providing stability to interest rates for the time being. Tomorrow will be a short trading day as the markets close early in preparation of Monday’s 4th of July celebration. Next week’s economic news reports will be heavily influential to the near term direction of mortgage interest rates, highlighted by Friday’s Bureau of Labor Statistics’ Jobs Report which will announce job gains for the month of June.


Given the continued strength in the stock market, we see little hope of bonds making significant advancements. Therefore, now is again a great opportunity to lock in while mortgage rates are near all-time lows.

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