Stock market pressure causes Colorado Home Mortgage rates to jump up this afternoon
The lack of Economic news continues to have investors looking to the stock market for signs. Colorado Home Mortgage rates started off stable this morning as retailers continued to report week by week decrease in sales, causing investors to have some concerns about the risk in stocks. The day appeared to be heading in the right direction and Mortgage Backed Securities began to trade a bit higher then yesterday. This was short lived, as the headlines reported that Disney had higher then expected 1Q profits. The news forced money out of the bond market and into the stock market. This may be the reason for the late day rally in the Stock Market. Colorado Home Mortgage Rates did jump a bit late this afternoon, and we may see Colorado Home Mortgage rates continue to rise tomorrow morning. Having just watched Lilo & Stitch with my 2 year old I can understand the success Disney has reported and unlike any of the oil companies, I actually feel good about where they are going. Colorado Home Mortgage rates will however, continue to be impacted by headlines throughout the week. We have a couple of reports coming out tomorrow which can change the momentum and hopefully push Colorado Home Mortgage rates back down. We will watch these reports tomorrow and give you an updated on where the market is heading. I do have some concerns building up lately. Everything I am seeing in the market shows that we have some tough times ahead as it relates to Colorado Home Mortgage rates. We will continue to set our locking point to 5.75%. I have several people holding out and unless the momentum changes, we may want to go ahead and start locking in your Colorado Home Mortgage rate.
There are several things that I am concerned with, the biggest issue I have relates to how investors currently view the economy. I believe investors have been hit so hard for poor projections that they have become ultra conservative. The conservative approach has caused investors to project data at extremely low levels. In theory investors use this information and act accordingly as they buy and sell investments. Typically, investors will buy Mortgage Backed Securities during tough times and stocks during good times. When investors project poor economic data in the near future, activity in the bond market will increase. This will cause Colorado Home Mortgage rates to improve. The problem I am having recently is that I just don’t believe that investors are responding to the market according to the projections shown. This is causing the Mortgage Backed Securities market to be under inflated. Now when the actual data comes out investors have been reacted accordingly, causing the market to fluctuate up and down depending on what the economic data shows. The only proof I can give that will show the market is under inflated is the relationship between the 10 year Treasury bond and the 5.5% coupon bond. The 10 year treasury and the 30 year 5.5% coupon bond has shown signs which indicates a larger then expected pricing gap. The gap used to be much greater, but over the last couple of weeks has dissipated a bit. Though the gap is smaller we still have some room to move. Colorado Home Mortgage rates will see the benefits of the gap reduction over time, but it will take some time. This will all come down to investor confidence in the Mortgage Backed Securities market. Right now investors are not showing the confidence needed to reduce Colorado Home Mortgage rates down where we would like to see them. It is hard to project when investor confidence will return, but all the negative press about Colorado Home Mortgage companies going out of business or needing help certainly does not build the momentum we need. Countrywide and Fannie Mae are good examples of why investor confidence is so low.
The next issue I see is the continued inflationary risk in oil. It is obvious that when shipping cost increases the increase in cost is passed down to consumers. The increased pricing causes inflationary pressure, which adds more bad news for Colorado Home Mortgage rates. We will see this issue in the market for some time to come. Another problem facing Colorado Home Mortgage rates is corporate profitability. The corporate profitability reports have shown some real surprises in 1Q 2008. Several companies projected to report poor profitability actually reported that profitability was up. Adding fuel to the fire was the number of Mortgage companies that have indicated that their default rates will continue, causing sever profitability issues in the future. Countrywide continues to be the Headline leader in bad mortgage performance, but out just today, Fannie Mae has reported similar issues in their holdings. This has investors concerned about a possible bail out needed from the Federal Reserve. This will certainly add to an already unstable Mortgage Backed Securities market and will have investors continuing their conservative approach in the market.
My recommendation is to LOCK if and when you can get the recommended Colorado Home Mortgage rate of 5.75%. Its looking like 5.875% will be around for some time. Luckily we did hit a pricing ceiling at 5.875% so the rate will hold strong, but any major news can have rates going to 6.0%. I will be watching the Colorado Home Mortgage market very closely over the next few days. We may have to suck it up and simply lock while we are under the 6.0% range. Call me and I will be happy to answer your Colorado Home Mortgage questions. I had a crazy busy day to day that had me in and out of the office, so I apologize for not getting the Colorado Home Mortgage information out to you sooner. In retrospect rates did not move much if any since yesterday and seem to be lingering around the 5.875% range. I will post earlier tomorrow.
As I have stated before I will summarize the blog info in the last paragraph so here it is in the simplest of terms. Colorado Home Mortgage rates today are at 5.875%. These rates will be impacted by any Headline news because economic data this week is light. The Headlines had Disney showing stronger then expected profits which caused Colorado Home Mortgage rates to go up a bit. The Colorado Home Mortgage rate did not go up enough to hit 6.0%. We expect the Market to start off poorly tomorrow riding out the news seen today. We have a couple of reports that may help rates but will not know until these reports are released. Right now if you can get 5.75% at all I would LOCK. If you are a gambler we do have a long way to go in order to get below 5.75%. Today 5.75% will have an additional cost to it, I am hoping that the cost goes away by the end of the week at which time I will have a strong Colorado Home Mortgage LOCK recommendation in place. Call me with your Colorado Home Mortgage questions. Thank you for reading and please remember to visit www.coloradohomemortgageloan.net/news for more information.
Daniel
Tags: Colorado home, Colorado Home Mortgage, Home Mortage, investors, Rates
