Thursday's bond market opened down slightly following another stock rally, but has gained momentum and is now up 15 basis points. The stock markets are showing strong gains with the Dow up 182 points and the Nasdaq up 45 points. This morning's rates came out in line with yesterday's close, but we have had a re-post better of .125% to discount points.

Note: There is an inverse relationship between bond prices and mortgage interest rates. When bond prices go up, bond yields go down and subsequently, mortgage rates go down. 1 basis point is 1/100 of a point. So if the bond price goes up 12 basis points that equates to .125% lower discount points.

This morning's release of the 3rd Quarter Productivity data gave us favorable results. It showed a spike in productivity of a 9.5% increase. This was much stronger than expected, but that is good news for bonds for this type of data. Strong levels of productivity allow the economy to grow without inflation strains. Since inflation is the number one nemesis of the bond market, any news that eases inflation concerns is considered positive for bonds and mortgage rates.

The Labor Department also gave us last week's unemployment figures, reporting that 512,000 new claims for unemployment benefits were filed last week. This was lower than forecasts and can be considered negative for bonds, but fortunately this data is not important enough to heavily influence mortgage pricing.

October's monthly employment figures will be released early tomorrow morning. This extremely important report is comprised of many statistics and readings, but the most watched ones are the unemployment rate, the number of new jobs added or lost during the month and average hourly earnings. Current forecasts call for a 0.1% rise in unemployment to bring the national rate to 9.9%, a drop in payrolls of approximately 175,000 and a 0.1% increase in average earnings. Weaker than expected readings should rally bonds and lead to improvements in mortgage rates, while stronger than forecasted results would add fuel to the growing economy theory and likely lead to bond selling and higher mortgage rates tomorrow.

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... This is only my opinion of what I would do if I were financing a home. It is only an opinion and cannot be guaranteed to be in the best interest of all/any other borrowers.