Mortgage Rates Creep Up Then Fall
Mortgage Loan Information
A big surge in consumer confidence in December spurred aggressive selling in U.S. Treasuries. Traders dumped 5-, 10- and 30-year issues on fear that an upbeat consumer will grow the economy at a faster-than-expected pace, thus causing the Fed to hike rates. Selling sent prices plunging and yields, which move in the opposite direction of prices, soaring, with the benchmark 10-year yield hitting 4.35 percent. This happened because the confidence index rose to a five-month high of 102.3, far exceeding forecasts. In addition, confidence made great leaps in both satisfaction with current conditions and future expectations. Over the past several months consumers have been weighed down by lack of jobs, the price of oil and disappointment in stock market performance. But during December all these factors improved and confidence improved with them. When the yield on the 10-year note shot up, mortgage rates followed, with the rate on the 30 year nearing 5.625 percent. After the initial bout of selling, however, a move back to the status quo prevailed. The yield on the 10-year headed back down near 5.5 percent, where it's been since September.
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The consumer confidence numbers were great for Wall Street and all the indices responded positively. In addition, the last week of the year and the first couple of days of the new year have been historically good ones for stocks. Portfolio managers are sprucing up their holdings and putting cash that was on the sidelines to work, and there is optimism for the coming months. The Dow Jones added 0.75 percent and closed with only Intel in negative territory. Caterpillar led the Dow with a 2.5 percent gain and six others added more than 1 percent -- but it was solid gains across the board that kept the Dow afloat. The Nasdaq rose close to 1 percent, with Oracle and Ericsson leading the tech bellwethers with 1 percent-plus gains. Sun Microsystems gave back yesterday's increase, losing 2.5 percent, but declines by Cisco Systems and Intel were small. 4:00 PM: The 30-year Treasury bond was trading even in price with the yield holding at 4.91 percent.
The 10-year Treasury note was trading even in price with the yield holding at 4.29 percent.
The 5-year Treasury note was trading even in price with the yield rising to 3.65 percent.
At 4:00 PM:
AVERAGE mortgage rates (zero discount points) based on rates collected nationwide were:
The 30-year Conventional Fixed-Rate Mortgage was at 5.552 percent from 5.497 percent.
The 15-year Conventional Fixed-Rate Mortgage was at 4.995 percent from 4.946 percent.
The only report scheduled for tomorrow is existing-home sales for November, but it is a big one. Existing homes account for approximately 85 percent of all home sales and impact a number of sectors, including financials, retail, construction and other trades -- the list goes on. Other housing numbers for last month were grim, but unlike the previous data, these are lagging numbers. The street is expecting just a slight decline, which would support stocks. If, however, existing home sales drop substantially, this could stir up buying in Treasuries. Overnight and into tomorrow, however, rates should hold firm due to what turned out to be unchanged yields today.
Visit MortgageSort.com to get competitive mortgage refinance quotes.
A big surge in consumer confidence in December spurred aggressive selling in U.S. Treasuries. Traders dumped 5-, 10- and 30-year issues on fear that an upbeat consumer will grow the economy at a faster-than-expected pace, thus causing the Fed to hike rates. Selling sent prices plunging and yields, which move in the opposite direction of prices, soaring, with the benchmark 10-year yield hitting 4.35 percent. This happened because the confidence index rose to a five-month high of 102.3, far exceeding forecasts. In addition, confidence made great leaps in both satisfaction with current conditions and future expectations. Over the past several months consumers have been weighed down by lack of jobs, the price of oil and disappointment in stock market performance. But during December all these factors improved and confidence improved with them. When the yield on the 10-year note shot up, mortgage rates followed, with the rate on the 30 year nearing 5.625 percent. After the initial bout of selling, however, a move back to the status quo prevailed. The yield on the 10-year headed back down near 5.5 percent, where it's been since September.
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The consumer confidence numbers were great for Wall Street and all the indices responded positively. In addition, the last week of the year and the first couple of days of the new year have been historically good ones for stocks. Portfolio managers are sprucing up their holdings and putting cash that was on the sidelines to work, and there is optimism for the coming months. The Dow Jones added 0.75 percent and closed with only Intel in negative territory. Caterpillar led the Dow with a 2.5 percent gain and six others added more than 1 percent -- but it was solid gains across the board that kept the Dow afloat. The Nasdaq rose close to 1 percent, with Oracle and Ericsson leading the tech bellwethers with 1 percent-plus gains. Sun Microsystems gave back yesterday's increase, losing 2.5 percent, but declines by Cisco Systems and Intel were small. 4:00 PM: The 30-year Treasury bond was trading even in price with the yield holding at 4.91 percent.
The 10-year Treasury note was trading even in price with the yield holding at 4.29 percent.
The 5-year Treasury note was trading even in price with the yield rising to 3.65 percent.
At 4:00 PM:
AVERAGE mortgage rates (zero discount points) based on rates collected nationwide were:
The 30-year Conventional Fixed-Rate Mortgage was at 5.552 percent from 5.497 percent.
The 15-year Conventional Fixed-Rate Mortgage was at 4.995 percent from 4.946 percent.
The only report scheduled for tomorrow is existing-home sales for November, but it is a big one. Existing homes account for approximately 85 percent of all home sales and impact a number of sectors, including financials, retail, construction and other trades -- the list goes on. Other housing numbers for last month were grim, but unlike the previous data, these are lagging numbers. The street is expecting just a slight decline, which would support stocks. If, however, existing home sales drop substantially, this could stir up buying in Treasuries. Overnight and into tomorrow, however, rates should hold firm due to what turned out to be unchanged yields today.
Visit MortgageSort.com to get competitive mortgage refinance quotes.
posted by Kirby P at 9:37 AM
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