Thursday's bond market is closing the year out with a negative day. The stock markets appear to be following suit with the Dow down 42 points and the Nasdaq down 6 points. The bond market is currently down 20/32, which will likely push this morning's mortgage rates higher by approximately .250 of a discount point.

The Labor Department reported this morning that 438,000 new claims for unemployment benefits were filed last week, falling well short of the 460,000 that was expected. This was also the lowest number of new claims since July 2008. However, this may have to do more with the fact of the holiday falling on a weekday last week than strength in the labor market. Still, bonds are reacting negatively to the news and with the low volume or thin trading because of the holiday, the reaction has been stronger than it normally would be.

Yesterday's 7-year Note auction went fairly well. It was met with an interest level that was average of the past four 7-year Note sales. This means not particularly strong or weak. The market reaction to the results was fairly muted and had little impact on mortgage rates.

The bond market will close at 2:00 PM ET today ahead of the New Year's Day holiday tomorrow. All of the U.S. financial markets will be closed tomorrow will reopen for regular hours Monday morning.

Next week brings us the release of a couple of very important reports. The first comes Monday morning when the Institute for Supply Management will release their manufacturing index for December. It measures manufacturer sentiment and is considered to be one of the more important reports we see each month. Current forecasts are calling for a slight increase in sentiment from November's level, meaning that the manufacturing sector likely did not weaken this month.

We would like to take this opportunity to wish you and yours a very happy and safe holiday. There will be no update to this report tomorrow, but we will post our weekly preview Sunday evening as usual.

If I were considering financing/refinancing a home, I would.... Float if my closing was taking place within 7 days... Float if my closing was taking place between 8 and 20 days... Float if my closing was taking place between 21 and 60 days... Float if my closing was taking place over 60 days from now... This is only my opinion of what I would do if I were financing a home. It is only an opinion and cannot be guaranteed to be in the best interest of all/any other borrowers.