Due to the complete lack of economic data to consider today and for a large part of the coming week - mortgage investors will shift their focus to the deluge of earnings reports from Corporate America due over the course of the next several days. Even more important than the earnings scorecard -- mortgage investors will be keenly interested in the business outlook each of the companies will provide. The forward looking expectations of Corporate America could either reinforce or undermine mortgage investors' assessment that recessionary influences will begin to ebb in the second-half of the year.
If forward looking business activity projections for the majority of companies remain bleak - look for stock prices to fall and directly benefit the prospects of lower mortgage interest rates. If that assessment proves to be wrong and Corporate America paints of picture of brighter business conditions developing in the next 90 days - stock prices will almost surely rise, dragging mortgage interest rates higher in the process.
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