Good Morning on this Tuesday,
Bonds are starting off in a small hole (maybe more of a divot) this a.m. The 10-yr has increased to 2.87% and mortgage bonds are off about a dozen bps. This is a second day in the red, but all is still well within the current trading range. I am hopeful this is just range bound trading during low volume. The credit for today’s selling goes to 1) Consumer confidence number coming in strong 2) Wholesale inventories coming in strong 3) progress on trade with Mexico and maybe Canada and 4) a new story about a potential German bailout of Turkey. Additionally we had some housing data this a.m. According to Case-Shiller, Home prices in 20 U.S. cities rose in June at a slower pace, as buyer demand wanes in the face of affordability constraints, including elevated mortgage rates, according to S&P CoreLogic Case-Shiller data released Tuesday. 20-city property values index increased 6.3% y/y (est. 6.4%), after rising 6.5% the prior month national home-price gauge advanced 6.2% y/y after 6.4% seasonally adjusted 20-city index rose 0.1% m/m (est. 0.2%) after 0.2% gain the prior month.
A key takeaway:
*After seasonal adjustment, Las Vegas had biggest month-over-month rise at 1.4 percent, followed by Cleveland, Detroit, and Minneapolis, each with a 1 percent increase
It is tough not to recommend locking as rates are slipping a bit.
Make today great!