June 1st, 2010 12:05 PM by Lehel S.
Tuesday's bond market has opened fairly flat following a calm open in stocks and no major surprises in this morning's economic data. The stock markets are close to Friday's closing levels with the Dow down a couple points and the Nasdaq nearly unchanged. The bond market is currently up 2/32, but we will likely see an improvement in this morning's mortgage rates of approximately .125 - .250 of a discount point due to strength late Friday.
The Institute for Supply Management (ISM) said late this morning that their manufacturing index rose last month to a reading of 59.7. This was slightly higher than revised forecasts, meaning manufacturer sentiment was a little stronger than thought. That is negative news for bonds, but it was not enough of a variance to heavily influence trading or mortgage rates this morning.
There is no relevant data scheduled for release tomorrow, so look for the stock markets to help drive bond trading and mortgage rates. I f the major stock indexes remain calm, mortgage rates should follow suit.
Overall, will likely to be the most important day of the week for mortgage rates with May's Employment report being posted. The rest of the week's data could also lead to noticeable changes in mortgage rates and we also need to watch for stock market volatility. I suspect this will be a fairly active week for rates, but most of the changes will probably come the latter part of the week.
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... Lock 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.