Market Update – Recovery Stalling Despite Stimulus Programs

Treasury and mortgage prices are slightly lower this morning ahead of today’s FOMC meeting. Investors will be most interested in the language contained in the statement released by the committee. The Fed is in a bind with recent economic data suggesting that the recovery is stalling despite all of the stimulus programs that have been implemented.

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Market Update – Market Fairly Quiet Ahead of FOMC Rate Decision

Some of the key releases for the week include the $74 billion of notes and bonds the Treasury is set to auction, the trade balance report, and Friday’s CPI and retail sales reports. There are no economic releases scheduled for today and we expect the market to be fairly quiet ahead of the big number for the week, which is tomorrow’s FOMC rate decision.

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Market Update – U.S. Expected to Lose Jobs For Second Consecutive Month

This morning’s jobs report was highly anticipated since rumors are that the FOMC is considering new easing moves due to a sputtering recovery. Today’s non-farm payrolls report was expected to show the U.S. lost jobs for the second consecutive month. Specifically, July payrolls were expected to show a -65k decline overall, adding to the -125k decline in June. The actual number show a -131k decline. Also, the expectations for next month’s numbers were revised downward. This is causing mortgage bonds to rally this morning.

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Market Update – ISM Non-Manufacturing Index Expected to Drop

This morning we had the MBA mortgage application report which showed that applications rose 1.3% last week, with the purchase applications component coming in slightly higher at 1.5%. Also, later this morning the July ISM non-manufacturing index is expected to drop for the 2nd month in a row from – .8 points to 53. Readings above 50 signal expansion.

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Market Update – Mortgage Prices Drop On Strong Earnings

Yesterday, Treasury and mortgage prices dropped on strong earnings and better than forecasted factory data. Mortgage prices are up this morning ahead of a busy economic calendar. This morning’s releases included June’s Personal Income and Spending, which came in lower than expected. This will be followed later this morning by June Factory Orders and the Pending Home Sales Index.

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