Daily Commentary by Larry Baer: The Labor Department reported earlier this
morning first-time claims for government jobless benefits fell 4,000 during the
week ended January 5th. This marks the fifth consecutive week
jobless claims have edged higher. Even so, mortgage investors shrugged
the whole thing off reasoning slowly rising jobless claims this time of year
are almost certain to be more of a reflection of holiday volatility than a sign
of a serious deterioration in the labor sector.
Uncle Sam will wrap
up this week's three-part auction series with the sale of $13 billion worth of
30-year bonds this afternoon. Today's sale will conclude at 1:00 p.m. ET and
I'll post the results as soon as possible once the final gavel falls.
My models are
indicating an increasing probability the current counter-trend rally in the
stock markets will have run its course by Monday, January 14th or
Tuesday, January 15th. If this assessment proves accurate, the
ensuing sell-off in the stock markets will almost certainly send capital once
again racing back into the relatively safe haven of Treasury debt obligations
and agency eligible mortgage-backed securities - a process that will almost
certainly prove supportive of the prospects for steady to perhaps fractionally
lower mortgage interest rates.
Be patient - be
disciplined - and use the strategies outlined above as a blueprint as you go
about the business of managing your borrowers' interest rate expectations this
week.
THE
MARKET IS ALWAYS RIGHT! . YOU AND I ARE SOME OF THE TIME
