Before you bemoan all of the challenges facing America at the present moment, may I suggest you take a few minutes and examine our Country's place in History. On so many levels we are the most dominate, most successful and will should be the most admired country in the History of Mankind.
It's not for our what we have acquired in my opinion which will demonstrate America's greatness but what this country has chosen not to do that will differentiate itself from the rest of the great "empires". As I view it, we are the last remaining superpower which choose NOT to acquire additional riches through our will or military might on other countries. Regardless of our existing challenges in Iraq and Afghanistan, we have the means to suppress most countries.
America didn't get lucky and fall into this position of greatness. It was through the dedication and sacrifices of our forefathers. Our men and woman who dedicated themselves to something much larger than themselves. The great Ronald Regan quoted the following regarding the 4th: "Let the Fourth of July always be a reminder that here in this land, for the first time, it was decided that man is born with certain God-given rights; that government is only a convenience created and managed by the people, with no powers of its own except those voluntarily granted to it by the people. "
Economic Calendar
Release Date & Time
Economic Indicator
Consensus Estimate
My Analysis
Mon. June 29
Big bag of nothing.
Tue. June 30
Ditto here.
Wed. July 1, 10:00 a.m. ET
June Institute of Supply Mgmt.
44.5 vs. last 42.9
Many analysts may see the improvement in this index as a clear indication the manufacturing sector is on track to resume growth in the second half of the year. I anticipate investors to nudge fixed income rates fractionally higher if the actual numbers match or exceed this forecast.
Thurs. July 2, 8:30 a.m. ET
Initial jobless claims for the week ended 6/27
Down 8,000
Initial weekly jobless claims remain stubbornly high. The expected 8,000 or so decline for last week will not do much to convince market participants that the largest swoon in the labor sector in post WWII history is over. This data set will be completely overshadowed by the far more important June nonfarm figures that will be released concurrently.
Thurs. July 2, 8:30 a.m. ET
June Nonfarm Payrolls Jobless Rate Average hourly earnings
Down 355,000 9.6% vs. last 9.4% +0.1% vs. last +0.1%
The payroll data has shown a declining number of job losses in each of the past four months. If the sequence continues uninterrupted this time around – look for mortgage interest rates to edge incrementally higher. A headline number showing a larger decline in nonfarm payrolls than projected, together with a national jobless rate of 9.6% or higher -- and/or large upward revisions to prior months payroll figures -- will tend to support steady to fractionally lower interest rates.
Thurs. July 2, 10:00 a.m. ET
May Factory Orders
+0.8% vs. last +0.7%
The expected rise in this metric of manufacturing activity is somewhat of "no-brainer." Already released data shows that durable goods orders (items manufactured to last three-year or more) rose 1.8% in May. Inventory levels are at such low levels that it is almost a certainty that factory activity had to kick-in to gear to fill the outstanding orders for durable goods. In any case, this old stale bit of macro-economic data will be sharply overshadowed by the earlier release of the June nonfarm payroll figures.
Thurs. July 2,
Mortgage market operating on normal schedule – no early close
In April, the Securities Industry and Financial Markets Association (SIFMA), the regulatory body for the bond and mortgage-backed securities markets, reduced the number of recommended early market closes it issues each year from twelve to five, Early close recommendations around the Good Friday, Memorial Day, Thanksgiving (day after), Christmas and New Year’s Day holidays remained unchanged
Fri. July 3
The mortgage market is closed for the July 4th Holiday
Mon. July 6, 10:00 a.m. ET June Institute of Supply Mgmt. Service Sector Index 45.5 vs. last 44.0 This broad barometer of economic activity is expected to show business conditions in the nation’s non-manufacturing sectors continued to improve slightly in June. Should the actual number fall close to the consensus estimate (a reasonable expectation) the impact of this data on the current level of mortgage interest rates will likely be negligible.
If you have an American flag, fly it this weekend.
Monday, June 29, 2009
Monday, June 22, 2009
Summer Solice
Summer has begun and with it a reality check for the equity markets. I personally moved out of equities into safer instruments. I anticipate a negative trading range through mid-September. We've had a nice seven week run, but with little positive economic news supporting this position, we are due for a correction. No mentioned this week of Jobs. Keep an eye on these reports going forward. If the employment figures don't improve over the next three months, things might turn for the worse.
Release
Date & Time
Economic Indicator
Consensus Estimate
My Analysis
Mon. June 22
Nothing of relevance
Tue. June 23, 9:00 a.m. ET
First day of a two-day Fed meeting
Tue. June, 23, 10:00 a.m. ET
May Existing Home Sales Up 2.7%
The pace of the decline for existing home sales continues to soften – suggesting to some analysts that the housing sector may be within months of reaching a meaningful bottom. Look for this report to have little influence on the market until/unless the pace of sales shows a trend of positive gains.
Tue, June 23, 1:00 p.m. ET
Treasury auctions $40 bil. of 2-year notes
The relative short maturity of this security should be attractive to a large number of investors. If so, this event will likely have little, if any meaningful impact on the direction of rates.
Wed. June 24, 8:30 a.m. ET
May Durable Goods Orders Ex. Transportation
-0.7% vs. last +1.7% -0.4% vs. last +0.4%
These figures will likely draw little more than a passing glance from market participants.
Wed. June 24, 10:00 a.m. ET
May New Home Sales
Up 2.2%
Big price concessions from builders and relatively low mortgage interest rates likely combined to nudge the pace of new home sales fractionally higher.
Wed. June 24, 1:00 p.m. ET
Treasury auctions $37 bil. of 5-year notes
The yield on this security is just a whisper below 3.0% -- a level likely high enough to draw solid bids from both domestic and foreign investors. If so, this event will tend to be supportive of steady to perhaps fractionally lower mortgage note rates.
Wed. June 24, 2:15 p.m.
The Fed releases its post meeting statement
No change to short term interest rates The Fed’s post-meeting statement will probably be upbeat regarding recent signs of improving economic conditions even though further deterioration in the labor market is expected. There is only a minuscule chance the Fed will choose to expand its plans to purchase mortgage-backed securities or Treasury obligations.
Thurs. June 25, 8:30 a.m. ET
Initial jobless claims for the week ended 6/25
Down 8,000
For most investors it is still too early to conclude the worst of this recession’s employment erosion is behind us. Look for this data to have little, if any meaningful impact on the mortgage market.
Thurs. June 25, 8:30 a.m. ET
Final revision Q1 GDP -5.7% vs. last -5.7%
Gross Domestic Product, a statistical measure of the value of all goods and services produced in the country, will post its first back-to-back quarterly decline in more than 50 years. A GDP reading of -5.7% is already priced into the markets. It will likely take an unexpected reading of -5.0% or better to put any upward pressure on interest rates resulting directly from this release.
Thurs. June 25, 1:00 p.m. ET
Treasury auctions $27 bil. of 7-year notes The result of this auction will likely exert a significant amount of pressure on the trend trajectory of mortgage interest rates for the balance of the week. A well bid auction will tend to support steady to note rates for bonds and mortgages while a poorly bid auction will probably lead investors to nudge interest rates incrementally higher.
Fri. June 26, 8:30 a.m. ET
May Personal Income Spending
PCE Index +0.3% vs. last +0.5% +0.3% vs. last -0.1% +0.1% vs. last +0.3%
If, as expected, the personal consumption expenditure index (one of the Fed’s favorite measures of inflation at the consumer level) matches or falls below the forecasted value -- this report will tend to be supportive of steady to fractionally lower rates.
Release
Date & Time
Economic Indicator
Consensus Estimate
My Analysis
Mon. June 22
Nothing of relevance
Tue. June 23, 9:00 a.m. ET
First day of a two-day Fed meeting
Tue. June, 23, 10:00 a.m. ET
May Existing Home Sales Up 2.7%
The pace of the decline for existing home sales continues to soften – suggesting to some analysts that the housing sector may be within months of reaching a meaningful bottom. Look for this report to have little influence on the market until/unless the pace of sales shows a trend of positive gains.
Tue, June 23, 1:00 p.m. ET
Treasury auctions $40 bil. of 2-year notes
The relative short maturity of this security should be attractive to a large number of investors. If so, this event will likely have little, if any meaningful impact on the direction of rates.
Wed. June 24, 8:30 a.m. ET
May Durable Goods Orders Ex. Transportation
-0.7% vs. last +1.7% -0.4% vs. last +0.4%
These figures will likely draw little more than a passing glance from market participants.
Wed. June 24, 10:00 a.m. ET
May New Home Sales
Up 2.2%
Big price concessions from builders and relatively low mortgage interest rates likely combined to nudge the pace of new home sales fractionally higher.
Wed. June 24, 1:00 p.m. ET
Treasury auctions $37 bil. of 5-year notes
The yield on this security is just a whisper below 3.0% -- a level likely high enough to draw solid bids from both domestic and foreign investors. If so, this event will tend to be supportive of steady to perhaps fractionally lower mortgage note rates.
Wed. June 24, 2:15 p.m.
The Fed releases its post meeting statement
No change to short term interest rates The Fed’s post-meeting statement will probably be upbeat regarding recent signs of improving economic conditions even though further deterioration in the labor market is expected. There is only a minuscule chance the Fed will choose to expand its plans to purchase mortgage-backed securities or Treasury obligations.
Thurs. June 25, 8:30 a.m. ET
Initial jobless claims for the week ended 6/25
Down 8,000
For most investors it is still too early to conclude the worst of this recession’s employment erosion is behind us. Look for this data to have little, if any meaningful impact on the mortgage market.
Thurs. June 25, 8:30 a.m. ET
Final revision Q1 GDP -5.7% vs. last -5.7%
Gross Domestic Product, a statistical measure of the value of all goods and services produced in the country, will post its first back-to-back quarterly decline in more than 50 years. A GDP reading of -5.7% is already priced into the markets. It will likely take an unexpected reading of -5.0% or better to put any upward pressure on interest rates resulting directly from this release.
Thurs. June 25, 1:00 p.m. ET
Treasury auctions $27 bil. of 7-year notes The result of this auction will likely exert a significant amount of pressure on the trend trajectory of mortgage interest rates for the balance of the week. A well bid auction will tend to support steady to note rates for bonds and mortgages while a poorly bid auction will probably lead investors to nudge interest rates incrementally higher.
Fri. June 26, 8:30 a.m. ET
May Personal Income Spending
PCE Index +0.3% vs. last +0.5% +0.3% vs. last -0.1% +0.1% vs. last +0.3%
If, as expected, the personal consumption expenditure index (one of the Fed’s favorite measures of inflation at the consumer level) matches or falls below the forecasted value -- this report will tend to be supportive of steady to fractionally lower rates.
Monday, June 15, 2009
Weekly Economic News Only
Given the madness in the equity markets the last three weeks I think investors take a breather and take-it-all-in. I see stocks declining for the week, bonds improving. Mortgage rates should continue to recover some and perhaps peek by Wednesday.
Release Date & Time
Economic Indicator
Consensus Estimate
My Analysis
Mon. June 15
Big Bag of Nothin'
Tue. June, 16 8:30 a.m. ET
May Producer Prices
Core Rate
+0.4% vs. last +1.5%
+0.1% vs. last +0.1%
The modest expected rise in the headline producer price index will not likely create much concern among investors. More importantly the core rate, a value excluding the volatile food and energy components, likely remained extremely low.
Tue. June 16, 8:30 a.m. ET
May Housing Starts &
Building Permits
+6.0%
+0.4%
The outsized gain in the May housing starts figure will be largely offset by the fact that building permits, an indication of future construction activity, remains within a whisper of its lowest level since 1959.
Tue. June 16, 9:15 a.m. ET
May Industrial Production &
Capacity Utilization
-0.5% vs. last -0.5%
68.6 vs. last 69.1
The massive decline in the manufacturing sector is expected to continue unabated during the month of May.
Wed. June 17, 8:30 a.m. ET
May Consumer Price Index
Core rate
+0.3% vs. last +0.6%
+0.2% vs. last +0.3%
Gasoline prices surged in May resulting in a modest gain for headline consumer inflation. Excluding the volatile food and energy components, core inflation at the consumer level remains near multi-month lows.
Thurs. June 18, 8:30 a.m. ET
Initial jobless claims for the week ended 6/13
Down 10,000
Look for this data to have little, if any meaningful impact investors discount today’s decline in the face of ramped-up expectations for a strong surge in jobless claims once the ramifications of the auto industry bankruptcies begin to work through the economy.
Thurs. June 18, 10:00 a.m. ET
May Leading Indicators
+0.8% vs. last 1.0%
This index, created by the private Conference Board, is considered by many to provide an indication of the economy’s likely path over the next three- to six-months. The majority of the upward surge in this index was likely created by the strong rally in the stock markets. If stock prices are falling to this point in the week, it is likely most mortgage investors will shrug off this report. If, on the other hand, stock prices show strength in the early part of the week, a reading of 0.8% or higher for this index will likely encourage mortgage investors to push interest rates incrementally higher.
Fri. June 19,
Release Date & Time
Economic Indicator
Consensus Estimate
My Analysis
Mon. June 15
Big Bag of Nothin'
Tue. June, 16 8:30 a.m. ET
May Producer Prices
Core Rate
+0.4% vs. last +1.5%
+0.1% vs. last +0.1%
The modest expected rise in the headline producer price index will not likely create much concern among investors. More importantly the core rate, a value excluding the volatile food and energy components, likely remained extremely low.
Tue. June 16, 8:30 a.m. ET
May Housing Starts &
Building Permits
+6.0%
+0.4%
The outsized gain in the May housing starts figure will be largely offset by the fact that building permits, an indication of future construction activity, remains within a whisper of its lowest level since 1959.
Tue. June 16, 9:15 a.m. ET
May Industrial Production &
Capacity Utilization
-0.5% vs. last -0.5%
68.6 vs. last 69.1
The massive decline in the manufacturing sector is expected to continue unabated during the month of May.
Wed. June 17, 8:30 a.m. ET
May Consumer Price Index
Core rate
+0.3% vs. last +0.6%
+0.2% vs. last +0.3%
Gasoline prices surged in May resulting in a modest gain for headline consumer inflation. Excluding the volatile food and energy components, core inflation at the consumer level remains near multi-month lows.
Thurs. June 18, 8:30 a.m. ET
Initial jobless claims for the week ended 6/13
Down 10,000
Look for this data to have little, if any meaningful impact investors discount today’s decline in the face of ramped-up expectations for a strong surge in jobless claims once the ramifications of the auto industry bankruptcies begin to work through the economy.
Thurs. June 18, 10:00 a.m. ET
May Leading Indicators
+0.8% vs. last 1.0%
This index, created by the private Conference Board, is considered by many to provide an indication of the economy’s likely path over the next three- to six-months. The majority of the upward surge in this index was likely created by the strong rally in the stock markets. If stock prices are falling to this point in the week, it is likely most mortgage investors will shrug off this report. If, on the other hand, stock prices show strength in the early part of the week, a reading of 0.8% or higher for this index will likely encourage mortgage investors to push interest rates incrementally higher.
Fri. June 19,
Friday, June 12, 2009
What Come Up, Must Come Down
Given the craziness in the fixed income markets I thought an updated commentary which focused just that market is warranted. I'll keep this brief and simple.
In part, the massive run-up in mortgage rates was set-in-motion last month by whispers in the credit markets suggesting the United States might be on the verge of losing its prized AAA credit rating.
On Wednesday, Russia and Brazil put the world on notice that they each will begin investing in International Monetary Fund securities rather than the debt instruments of Uncle Sam. No sooner than these announcements hit the news wires - the yield on Treasury debt obligations and mortgage-backed securities skyrocketed as weaker, less experienced credit market participants bailed out of dollar-denominated assets.
Noteworthy, but this is more about political justling than anything else.
In Mortgages, 10-year notes and the Fannie Mae 5.0% 30-year fixed rate mortgage-backed securities are putting the finishing touches on a 200 basis-point two-day rally. A rally initiated by the fact that indirect bidders, which include foreign central banks, took home 49% of yesterday's $11 billion 30-year Treasury bond offering - marking the largest foreign investor participation rate at a U.S. debt auction since the Treasury Department reintroduced the 30-year bond in 2006. 49% indirect participation rate is a particularly telling statistic - coming as it does within hours of Russia's announcement that they intend to take their rubles and go play in credit markets elsewhere.
It takes two to tango. In response to Russia and Brazil, I am fairly confident a request was made to the Japanese (and other) to make some "line in the sand" comments. So, this morning the Japanese Finance Minister said his country's confidence in U.S. government debt is "unshakeable." His comments provided a nice little start to the trading day - as global investors responded to the solid endorsement from the second largest financer of American debt (behind the Chinese). In the coming week there will be no supply issues to deal with and the Fed will be active with a couple of small planned buybacks -- which leaves credit market participants with an opportunity to consider other influences effecting the trend trajectory of interest rates.
Next week's battery of macro-economic data ranging from the measures of inflation at the factory gates (Tuesday's May Producer Price Index) as well as prices paid at the front-door of every American (Wednesday's May Consumer Price Index) -- will likely be overshadowed by trading action in the stock markets. If, Corporate America falls short of generating the net income current stock valuations as I believe - stock values will fall and capital will flow back into the relative safe haven of Treasury obligations and mortgage-backed securities. That's a scenario that will be supportive of steady to fractionally higher fixed income prices. If I'm wrong, and the stock markets continue to soar - stock market gains will likely come at the expense of incrementally worsing mortgage interest rates. Those of you floating a fairly significant mortgage production pipeline may consider cashing in those loans (back to zero) as possible.
In part, the massive run-up in mortgage rates was set-in-motion last month by whispers in the credit markets suggesting the United States might be on the verge of losing its prized AAA credit rating.
On Wednesday, Russia and Brazil put the world on notice that they each will begin investing in International Monetary Fund securities rather than the debt instruments of Uncle Sam. No sooner than these announcements hit the news wires - the yield on Treasury debt obligations and mortgage-backed securities skyrocketed as weaker, less experienced credit market participants bailed out of dollar-denominated assets.
Noteworthy, but this is more about political justling than anything else.
In Mortgages, 10-year notes and the Fannie Mae 5.0% 30-year fixed rate mortgage-backed securities are putting the finishing touches on a 200 basis-point two-day rally. A rally initiated by the fact that indirect bidders, which include foreign central banks, took home 49% of yesterday's $11 billion 30-year Treasury bond offering - marking the largest foreign investor participation rate at a U.S. debt auction since the Treasury Department reintroduced the 30-year bond in 2006. 49% indirect participation rate is a particularly telling statistic - coming as it does within hours of Russia's announcement that they intend to take their rubles and go play in credit markets elsewhere.
It takes two to tango. In response to Russia and Brazil, I am fairly confident a request was made to the Japanese (and other) to make some "line in the sand" comments. So, this morning the Japanese Finance Minister said his country's confidence in U.S. government debt is "unshakeable." His comments provided a nice little start to the trading day - as global investors responded to the solid endorsement from the second largest financer of American debt (behind the Chinese). In the coming week there will be no supply issues to deal with and the Fed will be active with a couple of small planned buybacks -- which leaves credit market participants with an opportunity to consider other influences effecting the trend trajectory of interest rates.
Next week's battery of macro-economic data ranging from the measures of inflation at the factory gates (Tuesday's May Producer Price Index) as well as prices paid at the front-door of every American (Wednesday's May Consumer Price Index) -- will likely be overshadowed by trading action in the stock markets. If, Corporate America falls short of generating the net income current stock valuations as I believe - stock values will fall and capital will flow back into the relative safe haven of Treasury obligations and mortgage-backed securities. That's a scenario that will be supportive of steady to fractionally higher fixed income prices. If I'm wrong, and the stock markets continue to soar - stock market gains will likely come at the expense of incrementally worsing mortgage interest rates. Those of you floating a fairly significant mortgage production pipeline may consider cashing in those loans (back to zero) as possible.
Monday, June 8, 2009
US Economy: Simply Not Sustainable
There was plenty of reasons to be optimistic with last week's unemployment report showing a sizable slow down in initial unemployment claims. This week's blog is going to be brief but I would like to present 5 reasons why our Economy may be headed for a substantial slowdown over the next 18 months. Let me repeat: I believe things may get much worse from here should any combination of the following happen:
As it relates to housing, I am afraid it will have many more dark days ahead of it. Rates are going up as is the cost of home ownership. Unlike the unemployment report, I am not seeing many things to get excited about. Unfortunately, I have more questions today than I did in August 2007 when I predicted a paradigm shift in our economy.
Release Date & Time
Economic Indicator
Consensus Estimate
My Analysis
Mon. June 8
Tue. June, 9. 10;00 a.m. ET
Apr. Wholesale Inventories
-1.1% vs. last -1.6%
This old stale data.
Tue. June 9, 1:00 p.m. ET
Treasury auctions $36 bil. of
3-year notes
The relative short maturity of this security should be attractive to a large number of investors. If so, this event will likely have little, if any meaningful impact on the direction of mortgage interest rates today.
Tue. June 9, before the end of the day
Most mortgage-backed securities "roll" to July delivery
This is a standard monthly administrative function of the mortgage market. The price impact of this event is already reflected on most investors’ rate sheets.
Wed. June 10, 1:00 p.m. ET
Treasury auctions $19 bil. of
10-year notes
The yield on this security has climbed above 3.9% - probably making this offering very attractive to a broad array of investors. If my comments above prove accurate, this will support higher mortgage interest rates.
Wed. June 10, 2:00 p.m. ET
Fed "Beige Book" is released
This report, named for the color of its cover, will provide an assessment of economic conditions in all 12 Federal Reserve districts. Most analysts anticipate the data will show that recessionary pressures are moderating in most of the country.
Thurs. June 11, 8:30 a.m. ET
Initial jobless claims for the week ended 6/06
Down 6,000
Look for this data to have little, if any meaningful impact on the market as investors discount today’s decline in the face of ramped-up expectations for a strong surge in jobless claims once the ramifications of the auto industry bankruptcies begin to work through the economy.
Thurs. June 11, 8:30 a.m. ET
May Retail Sales
Ex. auto
+0.5% vs. last -0.4%
+0.2% vs. last -0.5%
The government’s one time payment to Social Security recipients combined with tax refunds and other fiscal stimulus likely contributed strongly to the gains for both of the components of this report. If the consensus estimates proves accurate, mortgage investors will likely shrug the May Retail Sales gains off as a statistical aberration. Look for this data to have little, if any meaningful influence on the direction of equity markets today.
Thurs. June 11, 10:00 a.m. ET
Apr. Business Inventories
-1.0% vs. last -1.0%
This old stale bit of macro-economic news will likely do nothing more than take up space on this week’s calendar.
Thurs. June 11, 1:00 p.m. ET
Treasury auctions $11 bil. of
30-year bonds
The yield on this offering is above 4.5% -- a level that will hopefully be attractive to a large number of investors. If not, this event will likely serve to push fixed long term interest rates higher before the end of the day. This is not good news for mortgage rates as many a client are sitting out there waiting for things to turn around.
Fri. June 12,
- China begins to back away from buying our debt
- China's growth continues to drive up the demand (and price) for oil
- Consumer spending slows as the cost of capital is driven higher because of the continued US Treasury drive for capital
- Discussions continue in the global market about replacing the US dollar as the currency of choice to be replaced by the Euro
- Housing slows even further as a huge backlog of REO properties makes its way onto the market. Add the large number of adjustable rate and negative arm mortgage products (most with negative HPA) and this appears to be the one most likely baked in the cake.
As it relates to housing, I am afraid it will have many more dark days ahead of it. Rates are going up as is the cost of home ownership. Unlike the unemployment report, I am not seeing many things to get excited about. Unfortunately, I have more questions today than I did in August 2007 when I predicted a paradigm shift in our economy.
Release Date & Time
Economic Indicator
Consensus Estimate
My Analysis
Mon. June 8
Tue. June, 9. 10;00 a.m. ET
Apr. Wholesale Inventories
-1.1% vs. last -1.6%
This old stale data.
Tue. June 9, 1:00 p.m. ET
Treasury auctions $36 bil. of
3-year notes
The relative short maturity of this security should be attractive to a large number of investors. If so, this event will likely have little, if any meaningful impact on the direction of mortgage interest rates today.
Tue. June 9, before the end of the day
Most mortgage-backed securities "roll" to July delivery
This is a standard monthly administrative function of the mortgage market. The price impact of this event is already reflected on most investors’ rate sheets.
Wed. June 10, 1:00 p.m. ET
Treasury auctions $19 bil. of
10-year notes
The yield on this security has climbed above 3.9% - probably making this offering very attractive to a broad array of investors. If my comments above prove accurate, this will support higher mortgage interest rates.
Wed. June 10, 2:00 p.m. ET
Fed "Beige Book" is released
This report, named for the color of its cover, will provide an assessment of economic conditions in all 12 Federal Reserve districts. Most analysts anticipate the data will show that recessionary pressures are moderating in most of the country.
Thurs. June 11, 8:30 a.m. ET
Initial jobless claims for the week ended 6/06
Down 6,000
Look for this data to have little, if any meaningful impact on the market as investors discount today’s decline in the face of ramped-up expectations for a strong surge in jobless claims once the ramifications of the auto industry bankruptcies begin to work through the economy.
Thurs. June 11, 8:30 a.m. ET
May Retail Sales
Ex. auto
+0.5% vs. last -0.4%
+0.2% vs. last -0.5%
The government’s one time payment to Social Security recipients combined with tax refunds and other fiscal stimulus likely contributed strongly to the gains for both of the components of this report. If the consensus estimates proves accurate, mortgage investors will likely shrug the May Retail Sales gains off as a statistical aberration. Look for this data to have little, if any meaningful influence on the direction of equity markets today.
Thurs. June 11, 10:00 a.m. ET
Apr. Business Inventories
-1.0% vs. last -1.0%
This old stale bit of macro-economic news will likely do nothing more than take up space on this week’s calendar.
Thurs. June 11, 1:00 p.m. ET
Treasury auctions $11 bil. of
30-year bonds
The yield on this offering is above 4.5% -- a level that will hopefully be attractive to a large number of investors. If not, this event will likely serve to push fixed long term interest rates higher before the end of the day. This is not good news for mortgage rates as many a client are sitting out there waiting for things to turn around.
Fri. June 12,
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