Friday’s bond market has opened in negative territory again, extending yesterday’s late sell-off. Stocks are reacting to the same Iran headlines as bonds, pushing the Dow lower by 363 points and the Nasdaq down 236 points. The bond market is currently down 7/32 (4.44%), which with yesterday’s late meltdown is going to cause this morning’s mortgage rates to be somewhere between .375 and .625 of a discount point higher than Thursday’s early pricing. Just home much of a change you see this morning will depend on the size of the intraday revision you likely saw yesterday afternoon. There were widespread upward revisions as the bond market spiraled lower yesterday.

The news driving the markets late yesterday and again this morning is Iran related of course. News that Iran is not interested in the U.S. proposed peace plan and the fact that we are sending thousands of additional troops to the region underscores the theory that the conflict still has room to escalate and will not be ending soon. Headlines this morning that Israel is planning to escalate their attacks on Iran despite President Trump announcing a 10-day hold on the U.S. targeting energy sites has pushed oil prices higher again. This is causing pain and the gas pump, airlines and other prices that consumers are now paying.

This morning’s sole relevant economic data showed that consumer confidence about their personal financial situation dropped to its lowest level since December. The University of Michigan’s revised March Index of Consumer Sentiment was announced at 53.3 for this month. This was lower than expected a decline from February’s 56.6. The lower reading is being attributed to the Iran war and the spike in fuel prices. A decline is actually favorable news for bonds and mortgage rates even though the reason for the weaker confidence is troublesome. If consumers are less confident in their finances, they are less likely to make a large purchase in the immediate future. Since consumer spending makes up over two-thirds of the U.S. economy, weaker spending leads to slower economic growth.

Next week is very busy in terms of scheduled reports and other events that are likely to influence mortgage rates. The week starts with no data, but Fed Chairman Powell is participating in a moderated discussion with a Harvard economics class at 10:30 AM ET. This could start the week off with some volatility since there is little doubt inflation and the impact the Iran war is having on the economy are topics that will be discussed. This would be on top of any weekend headlines from the Middle East.

Some of the week’s key reports include Retail Sales (consumer spending) and the traditional new month batch of releases. We will get the ADP private-sector employment data, sales report, and the ISM manufacturing index Wednesday morning. They will be followed by the almighty monthly governmental Employment report Friday morning. There are also some additional economic reports that are less influential and a large number of Fed-member speaking events set for the week. Look for details on all of next week’s scheduled activities in Sunday evening’s weekly preview.

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.