| Last | Change | Percent | |
| S&P Futures | 1683.4 | -3.2 | -0.19% |
| Eurostoxx Index | 2748.6 | 6.6 | 0.24% |
| Oil (WTI) | 105.1 | 0.4 | 0.37% |
| LIBOR | 0.266 | 0.001 | 0.38% |
| US Dollar Index (DXY) | 81.71 | 0.050 | 0.06% |
| 10 Year Govt Bond Yield | 2.58% | 0.02% | |
| Current Coupon Ginnie Mae TBA | 104.4 | 0.1 | |
| Current Coupon Fannie Mae TBA | 103.8 | -0.1 | |
| RPX Composite Real Estate Index | 200.7 | -0.2 | |
| BankRate 30 Year Fixed Rate Mortgage | 4.35 |
Markets are down this morning as we head into a data-intensive week. Merger Mondays are back with a few big transactions. Bonds and MBS are down small.
We have 3 big events in bonds this week - first we have the FOMC meeting on Tues and Wed. The FOMC statement will undoubtedly be parsed very closely. We will also get the advance estimate of 2Q GDP on Wed. Finally, on Friday we get the jobs report. So lots of potential market-moving stuff towards the back end of the week.
There is a lot of discussion over who will be the next Fed Chairman after Bernanke's term is finished in January. Bernanke has said he doesn't want the job anymore. The two names mentioned are Janet Yellen and Larry Summers. Given that Summers hasn't even done a stint as a Fed governor, he would be a surprising pick. This looks like so much theater. The next Fed Head will be Yellen. Yellen is an even bigger dove than Bernanke, so keep that in the back of your mind when you think about taper timing.
This week we will have a lot of earnings reports from the mortgage REITs. While we expect to see declining book values, the more interesting data will involve how much the REITs have de-leveraged. Some have done nothing (Capstead). Others have sold paper and still have increased leverage ratios because the value of their portfolio has dropped. What we hear from the REITs will tell us a lot about how much selling remains to be done in the MBS market, and that will tell us which way we want to lean with rates.
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