{"id":8821,"date":"2020-01-17T19:23:17","date_gmt":"2020-01-17T19:23:17","guid":{"rendered":"https:\/\/intelliloan.com\/blog\/?p=8821"},"modified":"2024-10-16T19:01:28","modified_gmt":"2024-10-16T19:01:28","slug":"housing-starts-blow-past-expectations","status":"publish","type":"post","link":"https:\/\/intelliloan.com\/insights\/housing-starts-blow-past-expectations\/","title":{"rendered":"Housing Starts Blow Past Expectations"},"content":{"rendered":"

Before 8:30 am ET this morning,\u00a0<\/strong>the 10 yr note traded at 1.81% unchanged from yesterday, MBS prices -2 bps. At 8:30 am ET December housing starts and permits changed all of the that; starts expected at 1373K +0.6%; permits expected at 1458K +0.2%. Start at 1698K were up 16%, permits at 1416K \u20130.4%. The percentage gain was the largest since October 2016. Data for November was revised higher to show starts rising to a pace of 1.375 million units, instead of advancing to a rate of 1.365 million units as previously reported. The initial reaction sent the 10 yr yield up to 1.84% +3 bps and MBS prices at 8:45 -12 bps from yesterday’s close.<\/p>\n

We had bullish remarks this morning from David Pepper and Stan Druckenmiller on the outlook for the economy<\/strong>\u00a0and the equity markets. Two Wall Street billionaires add to the general outlook for the stock market, DJIA futures on the comments traded +76 points. Their comments, however, head caveats using the near term phrase.<\/p>\n

Oh no, it’s Davos starting today in Switzerland.\u00a0<\/strong>The big money, economists and central bankers meet each year in the snow to schmooze and chat. There’ll be a lot of TV interviews with the likes of Jamie Dimon sitting in heated shelters, commenting on all things good. Generally, no market reactions come out of it.<\/p>\n

Dec Industrial production declined 0.3%; capacity utilization at 77.0%; both right on forecasts.<\/p>\n

China said its economy grew 6.0%.<\/strong>\u00a0Many analysts believe it is lower than that as China is infamous, putting out inaccurate data. Its weakest in nearly 30 years in 2019. China’s December Retail Sales rose 8.0% yr\/yr (expected 7.8%; last 8.0%), December Industrial Production increased 6.9% yr\/yr (expected 5.9%; last 6.2%), December Fixed Asset Investment grew 5.4% yr\/yr (expected 5.2%; last 5.2%), and December Unemployment Rate ticked up to 5.2% from 5.1%. Q4 GDP increased 1.5% qtr\/qtr, as expected (last 1.5%), expanding 6.0% yr\/yr, as expected (last 6.0%). 2019 GDP grew 6.1% (prior 6.2%).<\/p>\n

To fund the increasing annual budget deficit, expected to exceed $1 trillion<\/strong>, Treasury announced it will begin 20 yr bonds in the first half of this year. Previously issued 30-year Treasuries with about 20-years left to maturity yield about 2.15%, suggesting the new debt will offer a sizable premium over other comparable notes. Debt growth is a critical issue, but politicians and the markets sweep it under the rug; there will be a day of reckoning but not these days.<\/p>\n

At 9:30 am ET\u00a0<\/strong>the DJIA opened +39, NASDAQ +30, S&P +6; any improvements in the indexes are new all-time highs. The 10 1.84% +3 bps. MBS prices at 9:30 -14 bps from yesterday’s close and -17 bps from 9:30 yesterday.<\/p>\n

At 10:00 am ET, the U. of Michigan preliminary Jan index<\/strong>\u00a0expected unchanged from Dec. at 99.3, as released the index was 99.1.<\/p>\n

Also, at 10:00 am ET Nov JOLTS job openings\u00a0<\/strong>were thought to be 7.1 mil down from 7.27 mil in October, as released 6.8 mil. A bit disappointing but not much of a market-mover.<\/p>\n

By 10:00 am ET, the stock market was slipping somewhat,<\/strong>\u00a0and the 10 yr and MBSs have shown a little improvement. Some volatility today so far in MBS trading.<\/p>\n

The rate markets remain in tight ranges,<\/strong>\u00a0not worsening when stock indexes continue to make new highs and like this morning improving from overnight and early morning.<\/p>\n

Source: TBWS<\/small><\/p>\n","protected":false},"excerpt":{"rendered":"

Before 8:30 am ET this morning,\u00a0the 10 yr note traded at 1.81% unchanged from yesterday, MBS prices -2 bps. At 8:30 am ET December housing starts and permits changed all of the that; starts expected at 1373K +0.6%; permits expected at 1458K +0.2%. Start at 1698K were up 16%, permits at 1416K \u20130.4%. The percentage […]<\/p>\n","protected":false},"author":2,"featured_media":120,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[12],"tags":[],"class_list":["post-8821","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-intelliloan"],"_links":{"self":[{"href":"https:\/\/intelliloan.com\/insights\/wp-json\/wp\/v2\/posts\/8821","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/intelliloan.com\/insights\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/intelliloan.com\/insights\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/intelliloan.com\/insights\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/intelliloan.com\/insights\/wp-json\/wp\/v2\/comments?post=8821"}],"version-history":[{"count":1,"href":"https:\/\/intelliloan.com\/insights\/wp-json\/wp\/v2\/posts\/8821\/revisions"}],"predecessor-version":[{"id":9016,"href":"https:\/\/intelliloan.com\/insights\/wp-json\/wp\/v2\/posts\/8821\/revisions\/9016"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/intelliloan.com\/insights\/wp-json\/wp\/v2\/media\/120"}],"wp:attachment":[{"href":"https:\/\/intelliloan.com\/insights\/wp-json\/wp\/v2\/media?parent=8821"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/intelliloan.com\/insights\/wp-json\/wp\/v2\/categories?post=8821"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/intelliloan.com\/insights\/wp-json\/wp\/v2\/tags?post=8821"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}