Market Analysis

The bond market opened down (slightly higher rates) and then deteriorated significantly late in the afternoon.  The deterioration was primarily caused by a much better than expected weekly initial jobless claims report.  Analysts had been expecting a decline of 9,000 claims.  The reported decline was 52,000.  The afternoon deterioration seemed to be a result of investors repositioning themselves to discount the "safe haven" trade of bonds as expectatioins of a rally in the stock market begin to grow.

Unless the bond market improves tomorrow morning we will most likely see rates increase by at least .125% on early morning rate sheets.