Rate Update for July 8, 2008
In a surprising reversal stocks sank yesterday after starting the day in positive territory. The sell-off in the equity markets helped mortgage-backed bonds rally which is why mortgages rates are slightly better this morning.
Looking ahead there are a number of speeches today from key officials including Ben Bernanke and Henry Paulson. Their comments always have the ability to impact the markets so we’ll be listening for what they have to say.
Earnings season for stocks kicks off today. Publicly traded corporations report their earnings every 3 months following the completion of a quarter. The reason this is important for mortgage rates is because of the inverse relationship between the stock market and bond market. For more information about this dynamic visit this link.
The bottom line is if the stock market rallies it will likely hurt mortgage rates and vice versa.