• Thursday’s mortgage rates should be approximately .375 - .500 of a discount point higher if compared to Wednesday’s early pricing. The bond market is currently down 12/32 (4.71%).

 • Stocks are responding to the same geopolitical headlines as bonds, pushing the Dow lower by 472 points and the Nasdaq down 499 points.

 • Yesterday’s 20-year Treasury Bond auction didn’t go as well as we had hoped. The benchmarks showed a weaker demand from investors than the previous sale of the same securities and slightly below the average of the most recent ten sales. We did see bond yields move a bit higher after results were announced at 1:00 PM ET, but it wasn’t enough of a change for most lenders to issue an intraday revision to mortgage rates.

 • Today’s only economic data was last week’s unemployment figures that revealed new claims for jobless benefits dropped to 187,000. This was noticeably lower than the 213,000 that was expected and a decline from the previous week’s revised 209,000 initial filings to signal the employment sector strengthened last week.

 • What is driving this morning’s trading is news from the Middle East that the Iran-backed Houthis group attacked oil ships in the Red Sea. This is a clear sign that the conflict is escalating and may continue to expand, which has oil prices topping $100 a barrel for the first time in two months.

 • Higher oil costs lead to higher gas prices at the pump and spreads to other energy products that causes prices to increase for businesses and consumers. In other words, higher oil prices fuel inflation that hurts bonds prices and leads to higher yields.

 • It is worth noting that this morning’s bond selling has the benchmark 10-year Treasury Note yield at its highest level of the year and breaking a level that was previously set in January of last year. We now have to go back to October of 2023 to find where the 10-year yield was higher.

 • Rising yields are bad news for mortgage shoppers because mortgage rates almost always track the direction of bond yields. It will be interesting to see what the few days bring in terms of geopolitical news that will affect bonds and mortgage pricing.

 • This week’s light economic calendar comes to a close late tomorrow morning when June's New Home Sales report will be released. This report only covers sales of newly constructed homes instead of resales. Forecasts have sales rising, hinting at housing strength.

 • An unexpected decline in new home sales would technically be favorable for bonds and mortgage rates, but we are not expecting to see a noticeable move in rates due to this data. Bond traders are much more focused on inflation and Middle East news.

 • Visit our Daily Commentary page on our site for detailed explanations on current news that is relevant to mortgage rates.

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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.