By James Brooks

The bond market is up 6/32 (2.33%), which should improve Raleigh area mortgage pricing by approximately .125 of a discount point.

October's Durable Goods Orders report was released at 8:30 AM ET this morning. The Commerce Department announced a 1.2% decline in new orders for big-ticket products. This was weaker than the 0.4% increase that was forecasted. Even a secondary reading that excludes more volatile and costly airplanes and related products came in slightly lighter than anticipated. This data is known to be volatile from month to month, so the large variance isn't as important as it would be if it came in other reports. Still, it points towards a softening manufacturing sector, making the data good news for bonds and mortgage rates.

Last week's unemployment figures were also released early this morning. They showed that 239,000 new claims for unemployment benefits were filed last week, down from the previous week's revised total of 252,000. The decline in initial filings is unfavorable news for bonds since it hints that the employment sector strengthened last week. However, it is only a weekly snapshot so it draws less attention than monthly releases and came at the same time as the important Durable Goods Orders report. Therefore, the news has had little impact on this morning's bond trading or mortgage pricing.

Also posted this morning but at 10:00 AM ET was the University of Michigan's revised Index of Consumer Sentiment for November. It showed a reading of 98.5, exceeding predictions of 97.9 and up from the preliminary reading of 97.8. The increase indicates that surveyed consumers felt a little more optimistic about their own financial situations than earlier this month. Since rising sentiment often translates into stronger levels of consumer spending, this is bad news for mortgage rates. Fortunately, the Durable Goods Orders report is considered to be a more important report. Accordingly, the markets are responding more heavily to that news than this release.

The minutes from the November 1st FOMC meeting will be posted at 2:00 PM ET this afternoon. They carry the potential to impact the financial and mortgage markets, although it is often minimally. Traders will be looking for any indication of the Fed's next move regarding monetary policy, particularly something that would hint that a rate increase will not come next month as it is widely expected to. If we get a reaction, it will come during mid-afternoon trading. This release is one of those that may cause some volatility in the markets after they are posted, or could be a non-factor. If they show anything surprising regarding when the Fed will raise key short-term interest rates again or their balance sheet reduction plan, we should see some movement in rates this afternoon, especially with many traders checked out by then for the holiday.

The financial markets will be closed tomorrow in observance of the Thanksgiving Day holiday. There will be no early close today ahead of the holiday, but the stock and bond markets will close early Friday before reopening Monday morning. I suspect that Friday will be a very light day in bond trading as many market participants will be home. The same can be said to some degree this afternoon also. Banks must be open Friday, but we will likely see little change to mortgage rates until Monday.

We would like to take this opportunity to wish everyone a wonderful Thanksgiving holiday.

If I were considering financing/refinancing a home, I would.... Lock if my closing was taking place within 7 days... Lock if my closing was taking place between 8 and 20 days... Lock if my closing was taking place between 21 and 60 days... Float if my closing was taking place over 60 days from now.