Yesterday the Federal Reserve confused markets with conflicting comments.  This is due to either the Fed testing the waters on reaction to unwinding QE's, or the Fed officials are on different pages.  The Fed clearly upset markets resulting in another huge spike in rates and what may be the beginning of a major correction in the stock markets.

Weekly jobless claims were released this morning with no noticeable reaction to the data.

Most all major stock markets around the world are in decline today and continue to show increased volatility since this mornings opening.

At 10am, April New Home Sales increased 2.3% (the annual increase is the largest since 1963).  As a result, builders are able to increase prices and now markets will look to May's sales data on both existing and new home sales to see how the Fed will adjust or react.

The next two weeks will see a major increase in volatility.  The 10 yr. note is currently sitting at 2.04%, an increase due to what many believe to be an over shooting of the market.

The drive for lower rates is believed to be over, with the expected low of the 10 yr. note to be 1.85%.  Any pull backs in rate will not be substantial, nor are they expected to last long.  Yesterday saw rates bounce around by 100 basis points in pricing, or about .25% in rate.

Take advantage of any improvement and lock your rate to capitalize on market adjustments.

The upcoming economic calender will be relatively quiet with all eyes on the next employment report due out on June 6th.  These days with MSB's being oversold, reports are carrying more weight than normal.

- Michael Corboy