One-time Rocket exec Mike Fawaz founded brokerage and tech firm Origna8 with his former adversary’s backing, which both say will enable it to quickly scale.

Federal Reserve Chair Jerome Powell told reporters Wednesday that he would remain on the Fed board after his term as chair expires next month, resolving the last and most significant open question about his departure and the onset of Kevin Warsh’s leadership at the central bank.

Kevin Warsh’s nomination to be the next chair of the Federal Reserve passed through the Senate Banking committee in a party-line vote.

Eligible purchases with the Better Home Equity Card, which lets homeowners instantly spend funds drawn from a home equity line of credit, earn 1% cashback.

President Biden had issued a rule in 2024 requiring newly constructed homes to abide by an energy mandate to be eligible for FHA- or USDA-backed mortgages.

Mortgage rates jumped higher today at the fastest pace in weeks to the highest levels since March 30th. There were two key motivations for the increase, but one accounted for a vast majority of the damage. News came out overnight that spoke to the possibility of a prolonged blockade of the Strait of Hormuz. Markets took this seriously because it involved conversations with oil executives to assess the the impact of a prolonged blockade on domestic energy markets and fuel prices. Bond yields (which correlate with rates) and oil prices lurched higher again this morning after a White House official reiterated/corroborated the overnight news. The supporting actor in today’s rate drama was the Fed announcement. While the Fed didn’t hike rates, 3 voters voiced their opposition to the wording of the Fed’s statement because it tacitly implies the Fed is more inclined to cut rates vs hike them in the near future. Those 3 voters would prefer to indicate that rates could go either way depending on inflation and the economy. The market took this as a minor negative indication for rates. Measuring in terms of 10-year Treasury yields, more than 80% of today’s rate spike was in place before the Fed announcement came out. The average mortgage lender is back to 6.50% for top tier 30-year fixed scenarios, up from 6.38% yesterday. Most lenders made mid-day adjustments to even higher rates as the underlying bond market continued to suffer into the afternoon. 

Today’s Weakness Mostly War-Related With Small Boost From Fed

Because today was was a “Fed day” and because bonds hit their weakest levels of the day after the Fed announcement, we may look back on the selling and blame the Fed. In actuality, the Fed was only a small piece of the puzzle. Specifically, 10yr yields had already moved up from 4.34+ to 4.40 before the Fed announcement. At the 3pm CME close, there was only 1 more basis point of selling (4.41). The overnight/morning weakness was already covered in the morning commentary, but as a reminder, it had to do with the potential for a longer-term blockade of The Strait of Hormuz. There were no major issues with the Fed, but the market didn’t like the fact that 3 dissenting voters preferred to abandon the vague reference to future rate cuts via the “additional adjustments” verbiage. 

Econ Data / Events

MBA Purchase Index (Apr)/24

177.7 vs — f’cast, 175.6 prev

MBA Refi Index (Apr)/24

977.9 vs — f’cast, 1023.1 prev

Mortgage (Mar)ket Index (Apr)/24

298.5 vs — f’cast, 303.3 prev

Building Permits (Mar)

1.372M vs 1.39M f’cast, 1.538M prev

Building Permits (Feb)

1.538M vs — f’cast, 1.386M prev

Core CapEx (Mar)

3.3% vs 0.5% f’cast, 0.6% prev

Durable goods (Mar)

0.8% vs 0.5% f’cast, -1.4% prev

Housing starts number mm (Mar)

1.502M vs 1.40M f’cast, — prev

Market Movement Recap

08:31 AM weaker overnight and modest additional selling after 830am data.  MBS down 3 ticks (.09) and 10yr up 2bps at 4.369

10:07 AM MBS down 10 ticks (.31) and 10yr up 5.3bps at 4.402

12:01 PM Some volatility in response to news that the US is considering renewed strikes in Iran, but losses have been erased since then. MBS still down about 30bps and 10yr up 5bps at 4.398

02:16 PM Slightly weaker after Fed announcement. MBS down 14 ticks (.44) and 10yr up 5.8bps at 4.406

02:53 PM Weakest levels. MBS down nearly half a point. 10yr up 7bps at 4.42

The former Wall Street player blamed its decline on rising interest rates, trouble at its lending subsidiary, and debt stemming from the Great Financial Crisis.

CrossCountry increased its agreed-to offer for the real estate investment trust by 50 cents per share, as UWM Holdings made an unsolicited bid on April 20.

Newrez expects significant expense reductions from AI partnerships with HomeVision and Valon, as executives rule out mergers and a Rithm spinoff amid strong Q1 earnings.