November 24, 2023 – Rate Commentary

• November 24, 2023
• realestate
• Business & Markets, Fed, Interest Rates, Politics & Economy, Rates, Real Estate, Real Estate Finance, Recession, World News, Your Real Estate Life

MBS OVERVIEW

Rosie the Riveter: The Preliminary S&P Markit Manufacturing PMI dropped from 50.0 down to 49.4 which is contractionary. The Services PMI moved from 50.6 to 50.8 which is expansionary.

In a short session today and with trading volume reduced, the interest rate markets opened weak, at 8:30 am ET the 10 year note up 7 bps to 4.48%, MBS price -24 bps, stock indexes at 8:30 am slightly better. Selling began in the Asian time frame, dipped a little when Europe began, then returned to the highs so far. The Bank of England officials warning that no interest rate cuts in the near term due to continued high inflation. ECBs policymaker Villeroy de Galhau said that he doesn’t expect another rate hike from the ECB unless an “unexpected event” takes place.

This is a day US markets should be closed, let the holiday continue. The stock market will close at 1 pm with little change. The bond market will end at 2 pm.

There is an NFL football game at 3 pm, Miami Dolphins versus NY Jets; it won’t be televised by the traditional networks though. The game can be seen only on Amazon Prime.

Today began the pause in fighting in Gaza, 39 hostages scheduled to be released. Pause will last four days, allowing Hamas to re-arm for the next round. Israel has not wavered; it is intent to eliminate Hamas from Palestine.

At 9:30 am the DJIA opened +47, NASDAQ -39, S&P -3. 10 year 4.47% +6 bps. FNMA 6.5 30 year coupon at 9:30 am -25 bps from Wednesday’s close and -35 bps from 9:30 am Wednesday.

At 9:45 am the only data today, the global PMI composite index was 50.7 for Nov FLASH release, manufacturing index expected at 49.9, service sector index 50.5; as reported manufacturing, as reported manufacturing index at 49.4 and services at 50.6.

There isn’t anything specifically this morning that is pushing rate higher, after the recent decline based on no more rate increases and the potential the Fed will begin lowering rates at mid-year interest rates need new additional news to drive rates lower. As we noted Tuesday and Wednesday we reduced our long treasury bet, yet still holding a minor position. Next week inflation data for October personal consumption expenditures on Thursday.