March 3rd, 2010 9:42 AM by Lehel S.
Wednesday's bond market has opened in negative territory again with the stock markets showing gains. The Dow is currently up 44 points while the Nasdaq has gained 10 points. The bond market is currently down 10/32, but we will likely see a slight improvement in this morning's mortgage pricing due to strength in bonds late yesterday.
Today's only relevant report is the Fed Beige Book at 2:00 PM ET. It details economic activity throughout the country by region. The Fed relies heavily on this data during their FOMC meetings, so look for a potential reaction during afternoon trading. It probably will not cause a major sell off in the stock or bond markets, but could cause enough movement in bond prices to possibly improve or worsen mortgage rates slightly if it reveals any significant surprises.
There are two reports scheduled for release tomorrow morning. The first is the revised Productivity index for the 4th Quarter of last year. The preliminary r eading posted last month showed an annual rate of 6.2% increase in worker output. Analysts are expecting to see little change to the initial reading. Employee productivity is watched fairy closely because a higher level of output per hour is believed to mean that the economy can expand without inflation concerns.
January's Factory Orders will be posted late tomorrow morning, which will give us another measurement of manufacturing sector strength. This data is similar to last week's Durable Goods, except this report covers orders for both durable and non-durable goods. Current forecasts are calling for an increase in new orders of approximately 1.8%. A smaller than expected increase would be good news for the bond market and should lead to a small improvement in mortgage rates.
If I were considering financing/refinancing a home, I would.... Lock if my closing was taking place within 7 days... Lock if my closing was taking place between 8 and 20 days... Lock 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.