Thursday’s bond market has opened in negative territory following stronger than expected employment-related data. Stocks are showing early gains with the Dow up 192 points and the Nasdaq up 175 points. The bond market is currently down 5/32 (4.15%), but strength late yesterday should allow this morning’s mortgage rates to hold near Wednesday’s early pricing. If you saw an improvement in rates near the end of the day yesterday, you will probably see an increase this morning.

Yesterday’s afternoon release of the Fed Beige Book showed that economic activity had improved a little since the last update. Business contacts in eight of the Fed’s twelve regions reported a slight or moderate increase in activity while only one region said activity had slowed. The remaining three regions indicated no change in activity. This paints a stronger economic picture since a majority of the regions had previously reported no change. Other relevant points are the fact the employment situation seems to have stabilized but prices (inflation) rose at a moderate pace in most of the regions. The report didn’t draw much of a reaction in the bond market. Bond gains that we saw late in the day were well after the 2:00 PM ET release time, meaning they were not a result of what was in the report.

Last week’s unemployment figures were posted early this morning, revealing only 198,000 new claims for jobless benefits were filed during the week. This was a decline from the previous week’s revised 207,000 new claims and lower than the 212,000 that was expected. Declining claims are a sign of strength in the employment sector, so last week’s number of claims has to be labeled bad news for rates.

This week’s economic calendar closes with the release of December’s Industrial Production data at 9:15 AM ET tomorrow. It helps us measure manufacturing growth by tracking output at U.S. factories, mines and utilities. We don’t usually see a strong reaction to this report’s results and that should be no different this month. Forecasts have production up at a 0.2% rate. Unless there is a huge difference between expectations and forecasts, we shouldn’t see mortgage rates react to the report.

We also have two Fed-member speeches tomorrow that are worth watching. One is at 11:00 AM ET and the other is at 3:30 PM ET. Both have topics related to the outlook of the economy and monetary policy. We aren’t expecting them to yield a big surprise that will cause a noticeable move in the markets, but the possibility does exist when these topics are being addressed.

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.