Market Wrap-up
MBS OVERVIEW
Our benchmark FNMA MBS 6.50 September Coupon is currently up +6 BPS.
Consumer Sentiment: The preliminary August UofM Consumer Sentiment Index was 71.2. This morning, we got the final revision to that August reading to 69.5.
The Talking Fed: The Kansas City Federal Reserve’s Economic Symposium in Jackson Hole, WY is in full swing and Fed Chair Powell gave an address at 10:05 am. You can read his official prepared speech here. The big headline was that he still feels inflation is too high and that the Fed WILL NOT change their target inflation rate from 2% and that the Fed will force below trend growth to get inflation down to the 2% level.
The entire week was devoted to this morning’s speech from Jerome Powell. At the same gathering last year at Jackson Hole Powell roared and sent markets into big moves, the stocks crumpled and interest rates hot higher when he made it clear that the Fed was going to continue increase the FF rate until inflation fell to 2.0% that was then at 6.00%. Today a more quiescent Powell, he didn’t back away from the Fed’s 2.0%, refused to consider increasing the Fed’s 2.0% target; increasing the target higher so everyone could say the Fed has met its goals. His remarks though did set up the view that the Fed would not do another increase at the Sept. FOMC meeting (Sept 19 and 20). A curious note, Powell referred the PCE, his inflation gauge has been coming down, did he know more than we do, the PCE data won’t be released until next Thursday?
The equity market traded violently early after his comments, then settled down with the indexes rallying this afternoon.
Interest rate markets generally non-plused, the 10 year note unchanged on the day but the initial reaction pushed the yield up 4 bps but settled back, the 2 year note increased 4 bps but on the initial reaction the note climbed 10 bps to 5.10%. MBS prices up 6 bps and +4 bps from 9:30 am. The rate on 5-year Treasury inflation protected securities TIPS) rose further above 2% today, traders assessing the likelihood of a reaccelerating U.S. economy. The TIPS rate was headed for one of the highest levels since November 2008, according to Tradeweb.
Maybe overlooked this morning with Powell but a disappointing measure of consumers, the final August consumer sentiment index expected unchanged from two weeks ago declined.
Next Week: Monday Treasury will auction $45B of 2s and $46B of 5 year notes. Tuesday $36B 7 year note auction, June Case/Shiller June home prices, August consumer confidence index, July JOLTS job openings. Wednesday the weekly MBA mortgage application, August ADP private jobs, second release of Q2 GDP, July pending home sales. Thursday weekly jobless claims, July PCE, July personal income and spending, August Chicago purchasing mgrs. index. Friday August employment data, August ISM manufacturing index, July construction spending.
This Week: The 10 year note this week down 1 bp to 4.24%, the 2 year note increased 9 bps; FNMA 6.0 30 year coupon this week increased 16 bps. The DJIA -154, NASDAQ +300, S&P +36. Gold increased $25.00 while crude oil declined $1.28. The dollar had a strong week, the index increased 0.67 to 104.07. Bitcoin was volatile but ended the week down -99.
The long end of the curve and MBSs getting some traction, at least not seeing rates at the long end increase, not the same with the mid- and short-term rates that did increase. Our technicals are neutral for the short term.
CENY @ 4:00 PM 08.25.2023
10 year note: 4.24% unch
5 year note: 4.45% +3 bp
2 year note: 5.07% +6 bp
30 year bond: 4.29% -2 bp
30 year FNMA 6.0: 99.52 +4 bp (+5 bp from 9:30)
30 year FNMA 5.5: 97.92 +7 bp (+9 bp from 9:30)
30 year GNMA 5.5: 98.21 +4 bp (+20 bp from 9:30)
Dollar/Yuan: $7.2829 +$0.0120
Dollar/Yen: 146.37 +0.54 yen
Dollar/Euro: $1.0808 unch
Dollar Index: 104.07 +0.09
Gold: $1941.60 -$5.50
Bitcoin: 25,966 -30
Crude Oil: $80.07 +$1.02
DJIA: 34,346.90 +247.48
NASDAQ: 13,590.65 +126.67
S&P 500: 4405.71 +29.40
SOFR Data 01/12: 30-DAY AVERAGE(%): 4.27871, 90-DAY AVERAGE(%): 3.80444, 180-DAY AVERAGE(%): 3.09649, INDEX: 1.06132549
Poland
| NAME | VALUE | NET CHANGE | % CHANGE | 1 MONTH | 1 YEAR | TIME (EDT) |
| WIG20:IND
|
2,000.42 | -9.16 | -0.46% | -8.31% | +22.57% | 11:15 AM |
| WIG:IND
|
67,706.44 | -301.13 | -0.44% | -5.89% | +27.57% | 11:15 AM |
| WIG30:IND
|
2,477.56 | -12.80 | -0.51% | -7.95% | +23.87% | 11:15 AM |
WALUTY
| CURRENCY | VALUE | CHANGE | NET CHANGE | TIME (EDT) |
| EUR-USD
|
1.0796 | -0.0014 | -0.13% | 4:59 PM |
| USD-JPY
|
146.4400 | 0.6100 | +0.42% | 4:59 PM |
| GBP-USD
|
1.2578 | -0.0024 | -0.19% | 4:59 PM |
| AUD-USD
|
0.6404 | -0.0013 | -0.20% | 4:59 PM |
| USD-CAD
|
1.3601 | 0.0019 | +0.14% | 4:59 PM |
| USD-CHF
|
0.8847 | 0.0002 | +0.02% | 4:59 PM |
| USD-CZK
|
22.3141 | -0.0180 | -0.08% | 4:59 PM |
| USD-SKK
|
27.9050 | 0.0374 | +0.13% | 4:59 PM |
| USD-PLN
|
4.1371 | -0.0069 | -0.17% | 4:59 PM |
| USD-HUF
|
353.8400 | -1.3200 | -0.37% | 4:59 PM |
| USD-RUB
|
94.9852 | 0.5026 | +0.53% | 4:33 P |
| USD-MXN
|
16.7476 | -0.0841 | -0.50% | 4:5 |
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POŻYCZKI HIPOTECZNE
| ELITE 21-30 YEAR | ELITE 16-20 YEAR | ||||||
| RATE | 15 DAY | 30 DAY | 45 DAY | RATE | 15 DAY | 30 DAY | 45 DAY |
| 8.625 | -4.185 | -4.135 | -4.005 | 8.625 | -4.729 | -4.679 | -4.549 |
| 8.500 | -3.969 | -3.919 | -3.789 | 8.500 | -4.501 | -4.451 | -4.321 |
| 8.375 | -3.625 | -3.575 | -3.445 | 8.375 | -4.183 | -4.133 | -4.003 |
| 8.250 | -3.467 | -3.417 | -3.287 | 8.250 | -4.055 | -4.005 | -3.875 |
| 8.125 | -3.429 | -3.379 | -3.249 | 8.125 | -3.890 | -3.840 | -3.710 |
| 8.000 | -3.270 | -3.220 | -3.090 | 8.000 | -3.699 | -3.649 | -3.519 |
| 7.875 | -2.891 | -2.841 | -2.711 | 7.875 | -3.345 | -3.295 | -3.165 |
| 7.750 | -2.549 | -2.499 | -2.369 | 7.750 | -3.058 | -3.008 | -2.878 |
| 7.625 | -2.496 | -2.446 | -2.316 | 7.625 | -2.800 | -2.750 | -2.620 |
| 7.500 | -2.305 | -2.255 | -2.125 | 7.500 | -2.553 | -2.503 | -2.373 |
| 7.375 | -1.865 | -1.815 | -1.685 | 7.375 | -2.179 | -2.129 | -1.999 |
| 7.250 | -1.460 | -1.410 | -1.280 | 7.250 | -1.867 | -1.817 | -1.687 |
| 7.125 | -1.416 | -1.366 | -1.236 | 7.125 | -1.598 | -1.548 | -1.418 |
| 6.999 | -1.194 | -1.144 | -1.014 | 6.999 | -1.344 | -1.294 | -1.164 |
| 6.875 | -0.671 | -0.621 | -0.491 | 6.875 | -0.935 | -0.885 | -0.755 |
| 6.750 | -0.201 | -0.151 | -0.021 | 6.750 | -0.615 | -0.565 | -0.435 |
| 6.625 | -0.166 | -0.116 | 0.014 | 6.625 | -0.475 | -0.425 | -0.295 |
| 6.500 | 0.065 | 0.115 | 0.245 | 6.500 | -0.179 | -0.129 | 0.001 |
| 6.375 | 0.692 | 0.742 | 0.872 | 6.375 | 0.286 | 0.336 | 0.466 |
| 6.250 | 1.288 | 1.338 | 1.468 | 6.250 | 0.644 | 0.694 | 0.824 |
| 6.125 | 1.320 | 1.370 | 1.500 | 6.125 | 1.116 | 1.166 | 1.296 |
| 5.999 | 1.779 | 1.829 | 1.959 | 5.999 | 1.502 | 1.552 | 1.682 |
| 5.875 | 2.456 | 2.506 | 2.636 | 5.875 | 1.952 | 2.002 | 2.132 |
| ELITE 11-15 YEAR | ELITE 8-10 YEAR | ||||||
| RATE | 15 DAY | 30 DAY | 45 DAY | RATE | 15 DAY | 30 DAY | 45 DAY |
| 7.000 | -1.699 | -1.649 | -1.519 | 7.000 | -1.566 | -1.516 | -1.386 |
| 6.875 | -1.432 | -1.382 | -1.252 | 6.875 | -1.310 | -1.260 | -1.130 |
| 6.750 | -1.042 | -0.992 | -0.862 | 6.750 | -0.923 | -0.873 | -0.743 |
| 6.625 | -0.749 | -0.699 | -0.569 | 6.625 | -0.630 | -0.580 | -0.450 |
| 6.500 | -0.712 | -0.662 | -0.532 | 6.500 | -0.579 | -0.529 | -0.399 |
| 6.375 | -0.650 | -0.600 | -0.470 | 6.375 | -0.518 | -0.468 | -0.338 |
| 6.250 | -0.324 | -0.274 | -0.144 | 6.250 | -0.205 | -0.155 | -0.025 |
| 6.125 | -0.011 | 0.039 | 0.169 | 6.125 | 0.108 | 0.158 | 0.288 |
| 6.000 | 0.137 | 0.187 | 0.317 | 6.000 | 0.274 | 0.324 | 0.454 |
| 5.875 | 0.349 | 0.399 | 0.529 | 5.875 | 0.482 | 0.532 | 0.662 |
| 5.750 | 0.785 | 0.835 | 0.965 | 5.750 | 0.904 | 0.954 | 1.084 |
| 5.625 | 1.230 | 1.280 | 1.410 | 5.625 | 1.329 | 1.379 | 1.509 |
| 5.500 | 1.274 | 1.324 | 1.454 | 5.500 | 1.370 | 1.420 | 1.550 |
| 5.375 | 1.661 | 1.711 | 1.841 | 5.375 | 1.722 | 1.772 | 1.902 |
| 5.250 | 2.132 | 2.182 | 2.312 | 5.250 | 2.188 | 2.238 | 2.368 |
| 5.125 | 2.540 | 2.590 | 2.720 | 5.125 | 2.576 | 2.626 | 2.756 |
| 5.000 | 2.713 | 2.763 | 2.893 | 5.000 | 2.736 | 2.786 | 2.916 |
| 4.875 | 3.128 | 3.178 | 3.308 | 4.875 | 3.133 | 3.183 | 3.313 |
| 4.750 | 3.630 | 3.680 | 3.810 | 4.750 | 3.630 | 3.680 | 3.810 |
| 4.625 | 4.086 | 4.136 | 4.266 | 4.625 | 4.066 | 4.116 | 4.246 |
| 4.500 | 4.385 | 4.435 | 4.565 | 4.500 | 4.378 | 4.428 | 4.558 |
| 4.375 | 4.770 | 4.820 | 4.950 | 4.375 | 4.714 | 4.764 | 4.894 |
| 4.250 | 5.430 | 5.480 | 5.610 | 4.250 | 5.367 | 5.417 | 5.547 |