-57 Basis Points

http://globalhomefinance.com

This Market Snapshot is provided to you by RateAlert to help you stay current with market news.  To gain more insight, try our RateAlert Executive service today - Try it for 15 days for $1, risk free! Today's Rate Volatility: HIGH What happened yesterday? Mortgage backed securities (MBS) lost -57 basis points from Tuesday's close and closed at the second worst level of 2013. The benchmark FNMA 4.0 coupon started the day under a little pressure, which hinted that Tuesday's rally was over. We made specific mention of Tuesday's rally in our Morning Coffee Update video for both Tuesday and Wednesday.  We stated that it was only a temporary improvement and not a true trend reversal. We got our first dose of economic data for the week with Existing Home Sales.  They came in much stronger than expected (+6.5% vs estimates of +1.5%).  This shows some good strength in the housing market because this data included closed loans with the higher interest rates.  This positive economic news was negative for MBS and MBS sold off immediately (worse pricing for you) right after 10EDT. The minutes from the last FOMC meeting were released at 2:00EDT. You can read them for yourself here: http://www.federalreserve.gov/newsevents/press/monetary/20130731a.htm Just prior to the release, the benchmark FNMA MBS climbed off their lows of -26BPS to get all the way back to even. But then MBS sold off -44BPS immediately following the release of the minutes. Why? The minutes still did not provide a clear and definitive timeline for a pull back in MBS purchases, and about half of the members support a move now and half needed more data to decide. That may seem like indecision...but bond traders look at the fact that a couple of months ago only one voting member supported a tapper, then there were three, now it is half. So, that growing momentum is why MBS specifically sold off. What is on the agenda for today? Don't miss out on the mortgage industry's premiere insight and commentary. Subscribe to RateAlert Executive today and get today's lock advice, complete market commentary and forecast for today, and watch the full Morning Coffee Update video with Bryan McNee - all available only to our Executive subscribers.