General News Category Archives

Economic and Fixed Income Insights as of October 11, 2017

Presented by Stifel, Nicolaus & Company, Incorporated

Total mortgage application volume fell 2.1% last week, according to the Mortgage Bankers Association. Refinance activity continued to lag while applications to purchase a home also fell. The weak report was mostly due to higher interest rates. According to Freddie Mac, the average contract interest rate for a 30-year mortgage is 3.85%, its highest level since July.  For the week, taxable interest rates were fractionally higher while tax-exempt interest rates were mostly unchanged. The 10-year UST finished 4 basis points higher to yield 2.36% while the 30-year UST finished 3 basis points higher to yield 2.90%. The 10-year MMD was unchanged at 2.01%, and the 30-year MMD finished 2 basis points lower to yield 2.82%.

Interest Rate Observations

Benchmark Current Previous
Week
(+/-) Change Previous
Year
(+/-) Change
10-Year UST 2.36% 2.32% 4 1.77% 59
30-Year UST 2.90% 2.87% 3 2.50% 40
10-Year MMD 2.01% 2.01% 0 1.70% 31
30-Year MMD 2.82% 2.84% (2) 2.53% 29
Federal Funds Rate 1.25% 1.25% 0 0.50% 75
1-month LIBOR 1.24% 1.24% 0 0.53% 71
SIFMA 0.92% 0.94% (2) 0.87% 5
10-year LIBOR Swap 2.32% 2.28% 4 1.61% 71

Source: Thomson Reuters, Bloomberg. The table above reflects market conditions as of October 11, 2017

Important Disclosures

This material was prepared by Stifel, Nicolaus & Company, Incorporated (“Stifel”). This material is for informational purposes only and is not an offer or solicitation to purchase or sell any security or instrument or to participate in any trading strategy discussed herein. The information contained is taken from sources believed to be reliable, but is not guaranteed by Stifel as to accuracy or completeness. Past performance is not necessarily a guide to future performance. Stifel does not provide accounting; tax or legal advice and clients are advised to consult with their accounting, tax or legal advisors prior to making any investment decision.

Stifel, Nicolaus & Company, Incorporated is a broker-dealer registered with the United States Securities and Exchange Commission and is a member FINRA, NYSE & SIPC. @ 2017

Economic and Fixed Income Insights as of October 4, 2017

Presented by Stifel, Nicolaus & Company, Incorporated

Rising interest rates and rising home prices are cutting into mortgage demand, as fewer consumers have the incentive to refinance or purchase a new home. Weekly mortgage applications slipped 0.4% last week, according to the Mortgage Bankers Association. Volume now stands 24% lower than a year ago. The promise of tax reform and Fed policy speculation pushed taxable and tax-exempt yields higher for the week. In addition, the market-based probability of a December Fed rate hike rose again last week to about 70%.  The 10-year UST finished 12 basis points higher to yield 2.34% while the 30-year UST finished 11 basis points higher to yield 2.87%. The 10-year MMD finished 9 basis points higher to yield 2.01% while the 30-year MMD finished 6 basis points higher to yield 2.84%.

Interest Rate Observations

Benchmark Current Previous
Week
(+/-) Change Previous
Year
(+/-) Change
10-Year UST 2.34% 2.22% 12 1.57% 77
30-Year UST 2.87% 2.76% 11 2.29% 58
10-Year MMD 2.01% 1.92% 9 1.48% 53
30-Year MMD 2.84% 2.78% 6 2.27% 57
Federal Funds Rate 1.25% 1.25% 0 0.50% 75
1-month LIBOR 1.23% 1.24% (1) 0.52% 71
SIFMA 0.94% 0.88% 6 0.78% 16
10-year LIBOR Swap 2.30% 2.19% 11 1.42% 88

Source: Thomson Reuters, Bloomberg. The table above reflects market conditions as of October 3, 2017.

Important Disclosures

This material was prepared by Stifel, Nicolaus & Company, Incorporated (“Stifel”). This material is for informational purposes only and is not an offer or solicitation to purchase or sell any security or instrument or to participate in any trading strategy discussed herein. The information contained is taken from sources believed to be reliable, but is not guaranteed by Stifel as to accuracy or completeness. Past performance is not necessarily a guide to future performance. Stifel does not provide accounting; tax or legal advice and clients are advised to consult with their accounting, tax or legal advisors prior to making any investment decision.

Stifel, Nicolaus & Company, Incorporated is a broker-dealer registered with the United States Securities and Exchange Commission and is a member FINRA, NYSE & SIPC. @ 2017

Immediate Advocacy Needed on Behalf of the Historic Tax Credit

As anticipated, Republican leadership released a tax reform framework intended to guide House and Senate tax writing committees in their drafting of tax reform legislation. The framework does not explicitly preserve the historic tax credit and envisions that most business tax credits will be repealed in order to achieve a 20% corporate tax rate.

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Economic and Fixed Income Insights as of September 27, 2017

Presented by Stifel, Nicolaus & Company, Incorporated

The residential housing market in the US appears to have stalled. According to the National Association of Realtors, pending home sales dropped 2.6% in August, the fifth drop in the past six months and well below market expectations. The multifamily apartment market in the US remained sluggish in the third quarter as the vacancy rate climbed to its highest level in five years. The vacancy rate climbed to 4.5% in the third quarter from 4.1% in the same quarter a year earlier, according to Reis. For the week, both taxable and tax-exempt rates were mostly unchanged. The 10-year UST finished 1 basis point lower to yield 2.24% while the 30-year UST finished 4 basis points lower to yield 2.78%. The 10-year MMD finished 1 basis point higher to yield 1.92% while the 30-year MMD finished 1 basis point lower to yield 2.78%.

Interest Rate Observations

Benchmark Current Previous
Week
(+/-) Change Previous
Year
(+/-) Change
10-Year UST 2.24% 2.25% (1) 1.65% 59
30-Year UST 2.78% 2.82% (4) 2.37% 41
10-Year MMD 1.92% 1.91% 1 1.57% 35
30-Year MMD 2.78% 2.79% (1) 2.33% 45
Federal Funds Rate 1.25% 1.25% 0 0.50% 75
1-month LIBOR 1.23% 1.24% (1) 0.55% 68
SIFMA 0.88% 0.82% 6 0.70% 18
10-year LIBOR Swap 2.20% 2.21% (1) 1.50% 70

Source: Thomson Reuters, Bloomberg. The table above reflects market conditions as of September 26, 2017

Important Disclosures

This material was prepared by Stifel, Nicolaus & Company, Incorporated (“Stifel”). This material is for informational purposes only and is not an offer or solicitation to purchase or sell any security or instrument or to participate in any trading strategy discussed herein. The information contained is taken from sources believed to be reliable, but is not guaranteed by Stifel as to accuracy or completeness. Past performance is not necessarily a guide to future performance. Stifel does not provide accounting; tax or legal advice and clients are advised to consult with their accounting, tax or legal advisors prior to making any investment decision.

Stifel, Nicolaus & Company, Incorporated is a broker-dealer registered with the United States Securities and Exchange Commission and is a member FINRA, NYSE & SIPC. @ 2017

Economic and Fixed Income Insights as of September 20, 2017

Presented by Stifel, Nicolaus & Company, Incorporated

Markets have maintained an appetite for risk assets, sending both the Dow Jones Industrial Average and the S&P 500 to fresh records despite continued provocation from North Korea.  In the latest round of economic data, inflation surpassed expectations in August, jumping to a 1.9% annual pace, and retail sales disappointed.  Housing data was mixed with starts declining while permits rose.  Market attention is now focused on this week’s FOMC meeting where Fed officials are largely expected to leave the benchmark rate unchanged.

The uptick for inflation and decreased haven demand saw bond yields trend sharply upward over the past week.  The 10-year UST finished 10 basis points higher at 2.23% while the 30-year UST finished 6 basis points higher at 2.80%. The 10-year MMD finished 7 basis points higher at 1.90% while the 30-year MMD finished 9 basis points higher at 2.77%.

Interest Rate Observations

Benchmark Current Previous
Week
(+/-) Change Previous
Year
(+/-) Change
10-Year UST 2.23% 2.13% 10 1.73% 50
30-Year UST 2.80% 2.74% 6 2.46% 34
10-Year MMD 1.90% 1.83% 7 1.57% 33
30-Year MMD 2.77% 2.68% 9 2.28% 49
Federal Funds Rate 1.25% 1.25% 0 0.50% 75
1-month LIBOR 1.24% 1.24% 0 0.52% 72
SIFMA 0.82% 0.78% 4 0.64% 18
10-year LIBOR Swap 2.20% 2.08% 12 1.57% 63

Source: Thomson Reuters, Bloomberg. The table above reflects market conditions as of September 19, 2017.

Important Disclosures

This material was prepared by Stifel, Nicolaus & Company, Incorporated (“Stifel”). This material is for informational purposes only and is not an offer or solicitation to purchase or sell any security or instrument or to participate in any trading strategy discussed herein. The information contained is taken from sources believed to be reliable, but is not guaranteed by Stifel as to accuracy or completeness. Past performance is not necessarily a guide to future performance. Stifel does not provide accounting; tax or legal advice and clients are advised to consult with their accounting, tax or legal advisors prior to making any investment decision.

Stifel, Nicolaus & Company, Incorporated is a broker-dealer registered with the United States Securities and Exchange Commission and is a member FINRA, NYSE & SIPC. @ 2017