Friday’s bond market has opened in negative territory due to stock gains and mixed economic data. The stock markets are reacting favorably to words of confidence out of Greece, pushing the Dow back above 12,000. The Dow is currently up 79 points while the Nasdaq has gained 8 points. The bond market is currently down 5/32, which should keep this morning’s mortgage rates close to yesterday’s levels.
June’s preliminary reading to the University of Michigan’s Index of Consumer Sentiment was posted late this morning, showing a reading of 71.8. This was lower than forecasts and a decline from May’s final reading, making it good news for the bond market and mortgage rates. Since consumer confidence dropped this month, it is believed consumers are less likely to make large purchases in the near future, limiting economic growth.
The Conference Board reported this morning that May’s Leading Economic Indicators (LEI) rose 0.8%. This was much stronger than thought, meaning that the index is predicting rapid economic growth over the next several months. That contradicts recent opinions and economic releases, but we have to consider this news not favorable for bonds and mortgage rates. Fortunately, the data is not considered to be highly important, preventing the mortgage market from reacting much to the news.