Final Update/ Week of April12, 2010/ Rate Improvement

Good Morning Everyone and Happy Friday! And boy, is this a happy Friday for those of you that have been waiting for stocks to break and mortgage pricing to improve! Equity markets were ticking along just fine this morning hovering around the unchanged mark early on. It looked like this was just going to be a lack luster day on Wall Street . . . and then the bottom fell out. Around 7:30 a.m. our time, the SEC announced that they would be filing charges against Goldman Sachs for fraud. The SEC is accusing Goldman Sachs and one of it’s VP’s of fraud “by misstating and omitting key facts about financial instruments related to subprime mortgages.” Shares of Goldman have dropped over $23 a share now and financials are falling like a rock.

The impact to the rest of the markets is truly something to behold. Many of us have been looking for a correction for some time now as the stock markets have just climbed non stop for 2 months. Maybe traders are using this event to sell out of positions they felt were over bought in the first place. Anyway, the Dow is down about 150 points now, commodities are down straight across the board, and credit markets are improving. The Volatility Index is up 18.3%!

Too bad for bullish traders, because the market received some good news this morning in the housing industry. New construction of US houses rose for the 3rd straight month in March, per the Commerce Dept. Housing starts rose 1.6% in March, stronger than expected. Building permits rose 7.5%, the highest level since Oct. of 2008. However, the Reuters/Univ of Michigan Consumer Sentiment Index dropped to 69.5 in April from the 73.6 posted last month. Analysts were looking for a reading of 75. This mixed picture had the market at the flat line until the big announcement was released by the SEC.

The rate sheet attached reflects the pricing as of that moment in time, but we are bound to get pricing improvements from investors through out the morning. I will be getting to you a revised rate sheet as soon as that happens. This looks like it’s a good day to lock if we start getting improvements. Monday will likely see some kind of bounce after traders get the weekend to let their heart rates slow down.
I’m here in the office all day today. Call me here or email me if I can help you with a loan scenario or a lock. Have a terrific Friday and a very restful and relaxing weekend