Markets under pressure

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Published Date 9/25/2024

At 8:30 am ET this morning the 10 year note at 3.76% +3 bp, MBS prices down 11 bps from yesterday’s close.

Weekly MBA mortgage applications, the composite increased 11.0%, purchase applications +1.4% but re-finances roared ahead increasing 20.3%; the week prior re-finances were up 24% from the week before that.

The Fed is banking on a soft landing for the economy in 2025 by aggressive rate cutting, (another 50 bps expected this year and a number of Fed officials anticipating another 100 bps in 2025). Investors and traders not so sure yet.

At 9:30 am the DJIA opened -3, NASDAQ +2, S&P +5. 10 year 3.77% +4 bp. FNMA 5.5 30 year coupon at 9:30 am -8 bps from yesterday’s close and +1 bp from 9:30 am yesterday. Neither stocks or bond markets are moving so far this week.

August new home sales at 10 am, expected at 700K from 739K; reported at 716K and July revised from 739K to 751K. We will have details this afternoon.

At 1 pm Treasury will auction $70B of 5 year notes. Yesterday’s 2 year auction was neither soft nor strong but just right, like the porridge.

Yesterday rates began higher, then at 10 am the consumer confidence index flipped rates to end the day slightly lower; today there isn’t any key data that might move rates lower. Tomorrow Jerome Powell will speak, Friday inflation with the Fed’s fav PCE.

Source: TBWS

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