Trade in the stock index futures early this morning was better sending prices for mortgages and treasuries lower. At 8:00 the 10 yr -10/32 at 3.63% and mortgages -5/32 (.15 bp). Friday once again the 10 yr note ended at the 3.60% level (3.59%), with the slight increase this morning it is the sixth time in two weeks the note has failed to crack the chart resistance level. The 10 yr and mortgages however, are both better based on their key 20 and 40 day moving averages; the 10 yr 40 day at 3.65% and on the mortgage prices the 40 at 100 16/32 (100.51 bp).
At 8:30 Dec personal income, expected +0.3% was +0.4%, spending expected to be +0.3% was up 0.2%; Nov income revised to +0.5% frm +0.4% and spending revised to +0.7% frm +0.5%. No real reaction to the data. The 10 yr at 9:00 -8/32 (.25 bp) and mortgage prices -3/32 (.09 bp) frm Friday’s close. It was the third month in a row spending was up; markets see it as confirmation that consumers are beginning to increase spending. Can we say gift buying? Consumers may be increasing spending, but until job losses bottom and employment improves, and until the housing sector turns, spending isn’t likely to recover to the extent the bullish view anticipates.
At 9:30 the DJIA opened +66, the 10 yr -10/32 at 3.63% +4 BP and mortgage prices at 9:30 -5/32 (.15 bp).
At 10:00 the Jan ISM manufacturing data; the overall index expected at 55.2 frm 55.9, was strong at 58.4; new orders component at 65.9 frm 64.8 in Dec, employment at 53.3 frm 50.2 and prices pd at 70.0 frm 61.5. The data was much better than traders were expecting and added to the selling in treasuries and mortgages. Any index read over 50 is considered expansion.
Also at 10:00 Dec construction spending, expected to be down 0.5%, was down hard, -1.2%. Markets put it on the back burner however, focusing more on the ISM report.
Market Minute information for February 1st, 2010 provided by:
 Patsy Bailey Mortgage Banker |
 4801 Lang Ave NE Suite 100 Albuquerque, NM 87109 4001 Office Court Ste 603 Sante Fe, NM 87507 Cell: 505.715.3231 Office: 505.473.4045 ext.109 E-mail: patsybailey13@gmail.com |
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