No Barrier Too High

“THERE IS NO BARRIER TOO HIGH, NO VALLEY TOO DEEP… NO DREAM TOO EXTREME, NO CHALLENGE TOO GREAT” ~ Charles Swindoll and that motivating phrase was a great motto for last week, as both Bonds and home loan rates ended up being greatly challenged as they dreamed of breaking through technical barriers to attempt some improvement. Lots of intra-week action ensued - but when the dust settled, Bonds and home loan rates rallied in the face of challenges and ended the week very close to where they began.

Bond prices and home loan rates started the week to the upside, as Wachovia announced they were removing their CEO and Stocks faced some selling pressure on the news, moving money into Bonds and helping rates improve. But the rally was very short lived, as Wednesday’s “unofficial” Employment Report by giant payroll processor ADP indicated 40,000 new private sector jobs were added in May…and while this good economic news gave Stocks a boost, it pulled money right back out of Bonds and caused home loan rates to worsen. Thursday’s positive economic news that unemployment claims for the week were lower than expected caused Bonds and home loan rates to worsen even further, as traders began to speculate on what the “official” Jobs Report by the Department of Labor would contain.

And on Friday morning, along came the big enchilada, the monthly Jobs Report. The Unemployment Rate increased to 5.50%, up from 5% last month - the largest jump since February of 1986. This was much worse than the market expected. And remembering that bad economic news tends to be bad news for the Stock market, but good news in turn for the Bond market, the news was positive indeed for Bonds and home loan rates - helping them to end the week relatively unchanged.

STOCKS AND BONDS AREN’T THE ONLY THINGS ON THE MOVE THIS TIME OF YEAR. NOW THAT WE’RE INTO THE SUMMER SELLING SEASON, YOU OR SOMEONE YOU KNOW MAY BE ABOUT TO BUST A MOVE. CHANGE OF RESIDENCE IS EXCITING, BUT IT CAN ALSO BE A LOT OF WORK. READ THIS WEEK’S MORTGAGE MARKET VIEW FOR SOME TIPS ON HOW TO TAKE THE STRESS OUT OF MOVING!

Click here to read my Forecast for the Week.