The Mortgage Man

Get more out of your mortgage experience!

Friday June 6, 2008

The markets are confused by unemployment and oil prices.

An interesting day in the financial markets.  The media is headlining “Unemployment drops by the largest margin since 1975”.  That is not entirely true (as I’ve come to accept from the media in general).  What did happen is that unemployment last month was at 5.2%.  The projection was that it would go down to 5%, and instead, it rose to 5.5%.  They (the media) in turn are using the 0.5% gap as a headline gainer.

Now that I have vented a little, here is the scoop on today’s financial markets.  Bad unemployment figures are generally bad for the stock market; and what is bad for the stock market is usually good for bonds.  But, at the same time, oil prices are so volatile today that there are discussions of actually halting trading due to reaching intra day trading limits.  This is bad for bonds.

So we have good news for mortgages, and we have bad news for mortgages, and the net result appears to be stagnation.  At the time of this posting, mortgage bonds are trading off of their lows for the day, but still well below the 200 day moving average.

I would love to see some aggressive buying to stimulate mortgage rates a little better, but for now, conventional 30 year mortgage rates are still hovering in the low 6% range (depending on your loan and area of the country).

Have a great weekend.

Advertisements

1 Comment»

  Colleen Kulikowski wrote @

Great analysis! thanks for sharing!


Leave a Reply

Please log in using one of these methods to post your comment:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: