December 9th, 2009 12:00 PM by Lehel S.
Tuesday's bond market has opened in positive territory again following early weakness in stocks. The stock markets are showing sizable losses with the Dow down 85 points and the Nasdaq down 6 points. The bond market is currently up 11/32, which should improve mortgage rates by approximately .250 - .375 of a discount point over yesterday's morning rates.
There is no relevant economic news scheduled for release today or tomorrow. Therefore, I am expecting the stock markets to likely be the biggest influence on bond trading and mortgage rates today. If the major stock indexes move lower we may see bond prices move higher and mortgage rates improve this afternoon.
Tomorrow does bring us the first of this week's two important Treasury auctions. The 10-year Note sale will be held Wednesday while 30-year Bonds will be sold Thursday. Wednesday's auction is the more important of the two events and will likely influence mortgage rates more. Results of each sale will be posted at 1:00 PM ET. If they were met with a strong demand from investors, particularly international buyers, we should see afternoon strength in bonds and improvements to mortgage pricing those days.
There is no relevant economic news scheduled for release today, tomorrow or Wednesday. October's Goods and Services Trade Balance report will be posted early Thursday morning. This report gives the size of the U.S. trade deficit, but it is the week's least important release. It is expected to show a $37.0 billion trade deficit. Unless it varies greatly from forecasts, I don't expect it to affect mortgage pricing.
If I were considering financing/refinancing a home, I would.... Lock if my closing was taking place within 7 days... Float if my closing was taking place between 8 and 20 days... Float if my closing was taking place between 21 and 60 days... Float if my closing was taking place over 60 days from now... This is only my opinion of what I would do if I were financing a home. It is only an opinion and cannot be guaranteed to be in the best interest of all/any other borrowers.