Market Analysis

There are no significant economic news releases on the calendar today.  The stock market gained ground this morning and Fannie Mae and Freddie Mac mortgage-backed securities lost ground.  Much of the improvement we had seen in mortgage rates two weeks ago has now disappeared.  Below are  15 minute (from this morning) and 10 day charts of the Fannie Mae 5.5% 30 year fixed mortgage-backed security from Larry Baer's Market Alert site.  The price going down on this financial instrument translates into the yield/rate going up.  This week will be light in terms of economic data releases.   As such trading in the stock market and the price of oil will probably have the largest impact on the direction of rates, with a stronger stock market and higher price of oil causing rates to move higher and a weaker stock market and weaker price of oil causing rates to inch lower.  Also this week, several Fed Region Presidents will be making speeches and Fed Reserve Chairman Bernanke will be testifying before Congress on Thursday.  Any hints they give to when they may raise rates could also move the market.

15 Minute Chart of Fannie Mae 5.5% Mortgage-Backed Security

10 Day Chart of Fannie Mae 5.5% Mortgage-Backed Security