This week brings us the release of only two relevant monthly economic reports but neither of them is considered to be highly important. There are two important Treasury auctions this week that may influence mortgage rates more than the minor economic data that is scheduled. It is also a holiday-shortened week with the bond market closed Thursday in observance of the Veterans Day holiday. The stock markets will be open Thursday, but bonds will not be traded meaning that many lenders will be closed.

Neither of this week’s monthly economic reports is expected to lead to noticeable changes in mortgage rates. This means that the stock markets will likely be a significant influence on bond trading and mortgage rates in addition to the two particular Treasury auctions. If the stock markets extend their recent rally, we could see funds shift from bonds into stocks that potentially offer better returns. The Dow reached its highest level since September 2008 last week, therefore, all eyes will be watching to see if they can move much higher. If stocks fall from current levels early in the week, concerns about them being able to move much higher in the near future could lead to significant selling. That would make bonds more attractive to investors and lead to lower mortgage rates. Keep Reading...