Market Commentary

Updated on October 21, 2024 10:04:28 AM EDT

This week’s economic calendar started late this morning with the release of September’s Leading Economic Indicators report. The Conference Board announced a 0.5% decline in the LEI, meaning they are predicting weaker economic activity over the next three to six months. Since bonds tend to thrive and look more appealing to investors during weaker economic conditions, we can label the report good news. Unfortunately, this report doesn’t carry enough significance in the markets to offset the overnight weakness that carried into this morning’s session.

Tomorrow is the only day of the week that doesn’t have any relevant economic reports scheduled for the markets to digest. The remainder of the week has four more monthly reports, in addition to a Treasury auction, a Fed report and an abundance of corporate earnings releases and Fed speeches.

Overall, Friday is the best candidate to see a noticeable change in mortgage rates due to the release of Durable Goods Orders data, while tomorrow is likely to be the calmest day. The benchmark 10-year Treasury Note yield tried to break below the 4.00% threshold last week but failed to do so and this morning’s selling has moved it further away. This is troublesome for mortgage shoppers because the inability to fall below that level makes a trend in the upward direction more likely and mortgage rates tend to track bond yields. This week’s trading could help solidify the direction of yields and mortgage rates over the next few weeks. At first look, that appears to be rates moving higher.