Daily Market Update 10/23/09

Mortgage rates faced upward pressure Friday as Existing Home Sales rose 9.4% last month according the the National Association of Realtors. Much of the increase was credited to a rush of first time homebuyers taking advantage of the $8,000 tax credit due to expire November 30. The inventory of unsold homes fell to 7.8 months, the lowest level since March 2007. Mortgage-backed securities markets may be volatile next week, with a slew of key economic data scheduled for release. Durable Goods Orders will come out Tuesday, New Home Sales Wednesday, third quarter GDP Thursday, and the Chicago Purchasing Managers Index Friday. In addition, the Treasury will hold a 3 day auction of $116 billion in 2-, 5-, and 7-year notes beginning Tuesday. No other economic data will be released today.

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