Mortgage bond prices opened lower erasing the small gains seen yesterday afternoon and more.
Rates are under pressure from strong stock futures, an indication the DOW Jones index will open higher. Stocks and bonds compete for investors’ funds, when stocks are rising in value trades sell bonds (prices fall/rates rise) to buy stocks and vice verse.
In news released this morning, weekly jobless claims stood at 669,00 higher than expectations of 650,000. This data coupled with the ADP payroll report yesterday raises the bar for the jobs report tomorrow. Traders are now waiting for stocks to begin trade at 9:30 am ET and for the release of factory orders at 10:00 am ET.
This afternoon traders will begin preparing for the jobs report tomorrow. Following the ADP payroll report and jobless claims data, traders are looking for a horrible number. Current expectations are for the jobless rate to jump .4% to 8.5% and for the loss of 665,000 jobs.
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Thank you for your remarks. I will review your submission and post it accordingly. Dave.