We will continue to recommend floating rates due to favorable technicals - support holding, 10-yr yield at 2.33%. After this mornings volatility supplied by the better than expected economic data, Mortgage Bonds traded higher and ended in positive territory, showing resilience in the face of record high closes for the Dow and S&P. Existing Home Sales were up 1.5% in October from September to an annual rate of 5.26 million units, the best number for 2014. The Philly Fed soared to 40.8, the best level in 21 years! Supporting Bond prices was continued tame inflation at the consumer level and Fed buying Mortgage Bonds. The 3.5% coupon closed at 103.53 up 19bp. Stock gains were modest, but as mentioned, record closes for the Dow (17,719.00, +33.27) and the S&P (2,052.75, +26.15). The Nasdaq finished at 4,701.86 up 26.15 points as it marches towards its all-time closing high of 5,048.62 hit back on March 10, 2000. Oil was last seen at $76.20barrel up $1.69. There are no economic reports set for release tomorrow.
Posted on: Thu, 20 Nov 2014 23:30:01 +0000
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