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Daily Market Update 12/1/10

Mortgage rates moved higher Wednesday after the President of the European Central Bank suggested that the ECB would purchase additional troubled assets to support weaker nations, reducing the risk of defaults on government debt. Stocks rallied on the news, pushing bond markets lower. In economic news, third quarter Productivity was revised higher to 2.4%, close to forecast. The Institute for Supply Management manufacturing index fell to 56.6, in line with expectations. The Mortgage Bankers Association weekly purchase activity index increased by 1%, while the refinancing activity index decreased by 22% as mortgage rates moved higher. Average reported 30-year fixed rates for the week rose to 4.56%, not including fees. The Beige Book, a survey of economic activity by the Fed‘s 12 regional banks, will be released at 2:00 PM.

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