Mortgage bond prices are slightly lower mid-morning Wednesday erasing a small portion of the gains seen Tuesday afternoon. Rates are under pressure from positive stocks.
In news released this morning, the ADP payroll data indicated a non-farm payroll loss of 697,000 jobs. This number is near the BLS estimate for a job loss of 675,000 when the payroll report is released Friday.
Trades will spend the day watching stocks as they await the release of Fed Beige book data. The Fed Beige book details economic conditions in the Mid-Atlantic region and will be released at 2:00 pm ET.
Next week the Treasury is set to auction 3, 10 and 30-year bonds. They will announce the size of the auctions Thursday. The additional supply, especially on the long end of the yield curve may make it a difficult week for mortgage rates. Treasury debt competes with mortgage-backed securities for available funds. Globally governments are issuing record debt to raise cash for the bailouts. One concern among traders is the amount of debt may overwhelm available investment dollars causing rates to spike to attract buyers. The more debt that gets issued both here and abroad makes this more likely. The auctions occur next Tuesday, Wednesday and Thursday.
On the data front, Friday brings the monthly employment report. It is without a doubt the 800-pound gorilla of all economic data. Traders will begin to focus on the release today, which can cause some volatility. Current expectations are for the unemployment rate to stand at 8.00% and non-farm payrolls to shed 675,000 jobs.
Subscribe to:
Post Comments (Atom)
Posts
No comments:
Post a Comment
Thank you for your remarks. I will review your submission and post it accordingly. Dave.