Danny Salas

Chico, CA Interest Rates Market Report – Economic Influences – October 26, 2009

3rd Quarter Earnings Still Helping Stocks

Record Treasury Auction

Starting today at 10:00 a.m., Pacific Standard Time, the initial rolling out of this week’s record Treasury Auction, will pour into the market.  $123 Billion worth of Treasury Notes will be auctioned throughout this week.  Today, $7 Billion worth of 5-Year Treasury Inflation Protected Securities (TIPS).  The rest of the week shows 2, 5, & 7-Year Treasury Notes that have generally fared well for interest rates.  Particularly due to the fact that they are short term notes, compared to 10 and 30 Year Treasury Notes.

3rd Quarter Earnings

They are still helping Stocks by reporting better-than-expected numbers.  Verizon reported better earnings, however, I’m still not convinced that cutting the bottom line is true economic growth.  We’ll have to see how this plays out, in the future.

Wall Street Journal Prepares For Higher Interest Rates

On November 4-5, 2009, The Federal Open Market Committee (FOMC) will have their next meeting.  On the 5th, it is expected that they will report on how, and when, they will start to increase the overnight rate.  With their Mortgage-Backed Securities Purchase Program scheduled to end on March 30, 2010, you can bet on higher interest rates…period.  Are your buyer’s prepared?

Economic Activity

This week is full of economic activity, however, today is dead.  So, Stocks will play a large roll regarding where interest rates will head.  With 3rd Quarter Earnings continuing to surprise, and not much support left for rates, we’ll be watching the lock button closely, after Friday’s losses.
Related Must Reads

Why Be Leery Paragraph. Why short term bonds are less risky than longer term bonds
To Put It Simply, Stocks Are Overbought…Will This Trickle to 4th Quarter?

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This entry was posted on Monday, October 26th, 2009 at 7:46 am and is filed under Chico Home Loans, Home Buying, Interest Rates, Weekly Market Report. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

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