Bond Market Update
Bond Market Update
Market Update
Wednesday, December 2, 2020What's going on and why does it matter?
Mortgage bonds are hovering near their 10-day moving average after yesterday's steep decline. Meanwhile, stocks are hovering near all-time highs after yesterday's strong rally. The big news overnight was that the UK has become the first country to authorize the Pfizer-BioNTech vaccine for widespread use and that vaccinations would be starting there next week. The market is also hopeful that Congress may agree to some fiscal stimulus before year-end. On today's economic calendar, the ADP employment numbers for November came out much weaker than market expectations. The Fed is scheduled to purchase up to $8.7 billion of mortgage bonds today.
What should you do about it?
Watch for mortgage bond prices to remain in positive territory above their moving averages, but be prepared to lock your rate if mortgage bond prices fall below their 10-day moving average.
Economic Calendar
Economic reports that may impact mortgage rates this week:| Date | Report | Period | Prior | Est. | Actual |
|---|---|---|---|---|---|
| Mon 30 Nov | Chicago PMI | Nov | 61.1 | 59.0 | 58.2 |
| Mon 30 Nov | Pending Home Sales Change | Oct | -2.2% | 1.0% | -1.1% |
| Tue 1 Dec | Construction Spending | Oct | 0.3% | 0.8% | 1.3% |
| Tue 1 Dec | ISM Mfg. PMI | Nov | 59.3 | 57.9 | 57.5 |
| Wed 2 Dec | ADP National Employment | Nov | 365k | 410k | 307k |
| Thu 3 Dec | Initial Jobless Claims | Week of Nov 23 | 778k | 770k | |
| Thu 3 Dec | ISM Non-Mfg. PMI | Nov | 56.6 | 56.0 | |
| Fri 4 Dec | Non-Farm Payrolls | Nov | 638k | 500k | |
| Fri 4 Dec | Unemployment Rate | Nov | 6.9% | 6.8% | |
| Fri 4 Dec | Average Earnings | Nov | 0.1% | 0.1% | |
| Fri 4 Dec | Factory Orders | Oct | 1.1% | 0.8% |