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Mortgage Today (PM) - 05/06/26

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May 7, 2026

WTMS Blog Today = What's up in Mortgage Today (PM) - 05/06/2026 Peace deal optimism drove bond markets higher today as oil prices collapsed on hopes for a U.S.-Iran agreement, creating tailwinds for MBS and Treasury yields. The 10-year yield fell 7.7 basis points to 4.348%, while UMBS 5.0 coupons rallied half a point as diplomatic progress overshadowed stronger-than-expected employment data. Markets remain vulnerable to war-related headlines, but traders are pricing in additional gains if an official deal is achieved. MBA mortgage indices all declined meaningfully on May 1st, with purchase activity down to 171.1 from 177.7 previously and refinance demand sliding to 928.6 from 977.9. The broader Mortgage Market Index fell to 285.3 versus 298.5 last month, signaling persistent weakness in originations even as rates improved. These declining volumes suggest borrowers remain cautious despite today's market bounce. ADP employment data beat expectations with 109,000 jobs added in April, above the 99,000 forecast but a significant recovery from March's 62,000. This stronger labor report normally would pressure bonds, yet the geopolitical peace narrative dominated today's trading dynamics. Originators should watch how this employment strength evolves heading into Friday's official jobs report, which could reverse some of today's gains. Two Harbors acquisition dynamics intensified as UWM's Mat Ishbia made his case directly to shareholders with just 13 days before the vote. Ishbia acknowledged he no longer sees value in Two Harbors' management but still views their servicer's book and pristine mortgage portfolio as valuable strategic assets. His aggressive tone and criticism of the board's process signals this deal battle is far from over, despite multiple bid rejections. UWM's first-quarter results delivered $44.9 billion in originations with a return to profitability, powered by strong refinance activity and broker channel momentum. The company's AI investments appear to be gaining traction across technology systems designed to identify refinancing opportunities within existing borrower databases. UWM's performance underscores an execution gap in the industry—not all firms are capturing available refi volume at the same pace. **Locking vs Floating** Peace deal rumors sparked a sharp overnight rally that pushed 10-year yields down 7.7 basis points by market close. While these gains are substantial, the move itself wasn't driven by fundamental economic improvement but rather by geopolitical risk reduction and energy price relief. Risk-takers who had positioned for exactly this scenario benefited, but the bond market still has room for improvement if an official agreement is reached, suggesting additional upside remains if headlines continue improving. **Today's Events** MBA Purchase Index (May 1): 171.1 versus 177.7 prior MBA Refi Index (May 1): 928.6 versus 977.9 prior Mortgage Market Index (May 1): 285.3 versus 298.5 prior ADP Employment (April): 109,000 versus 99,000 forecast, 62,000 prior **Bond Pricing** **UMBS 30 yr** | Coupon | Price | Intra-Day Change | **GNMA 30 yr** | Coupon | Price | Intra-Day Change | **Treasuries** | Term | Yield | Price | Intra-Day Yield Change | | 2yr | 3.86 | 100.028 | -0.083 | | 3yr | 3.89 | 98.906 | -0.082 | | 5yr | 3.996 | 99.458 | -0.085 | | 7yr | 4.169 | 100.49 | -0.084 | | 10yr | 4.347 | 98.216 | -0.078 | | 30yr | 4.936 | 97.1 | -0.055 | Market Data

Mortgage Today (AM) - 05/06/26

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May 7, 2026

WTMS Blog Today = What's up in Mortgage Today (AM) - 05/06/2026 Treasuries rallied sharply on Iran peace deal optimism as 10-year yields dropped eight basis points to 4.35%, dragging Brent crude below $98 per barrel and spurring a risk-on sentiment across equities and commodities. UMBS coupons recovered modestly this morning with 5.0 at 98.74 and 6.0 at 102.26, though the rebound remained less than one-third the size of yesterday's selloff. The MBA Purchase Index fell to 171.1 from 177.7 previously, signaling continued pressure in purchase applications despite the intraday technical improvement. ADP jobs data came in at 109,000 versus the 99,000 forecast, slightly better than expected but not enough to reverse the broader risk-off momentum. Mortgage originators should monitor whether this bond strength holds or reverses if peace deal talks stall again. The weak loan index readings across purchase, refi, and total market activity suggest consumer demand remains tepid heading into spring selling season. MBA Refi fell to 928.6 from 977.9 while the overall Mortgage Market Index declined to 285.3 from 298.5. These declines reflect both rate sensitivity and economic caution among borrowers. For lenders, this environment rewards disciplined pricing and pipeline management rather than aggressive lock strategies. Tomorrow's data and geopolitical headlines will determine whether bonds hold ground for additional gains. Stock futures surged 1.6 percent on NASDAQ optimism and 1 percent on the S&P 500 as technology earnings and AI investment announcements drove outperformance. The dollar index fell 0.8 percent while gold jumped 3.3 percent to $4,707, signaling classic risk-off bond market behavior. If the Middle East situation deteriorates, expect immediate reversal in these moves and potential follow-through weakness in mortgage securities. Current market pricing assumes de-escalation, but execution risk remains material. **Locking vs Floating** Modest bond recovery today presents minor asymmetric risk favoring rate lockers on the assumption of a 50/50 probability of directional moves tomorrow. Yesterday's sharp selloff left room for technical improvement, but yesterday's spike in mortgage rates recovered even less than bond prices. Originators should view today's gain as a potential window to secure pipelines rather than a signal of sustained strength. The geopolitical tailwind supporting this rally is fragile and easily reversible, making aggressive float positioning hazardous. **Today's Events** MBA Purchase Index (May): 171.1 vs 177.7 prior MBA Refi Index (May): 928.6 vs 977.9 prior Mortgage Market Index (May): 285.3 vs 298.5 prior ADP Jobs (April): 109K vs 99K forecast Treasury Quarterly Refunding Announcement: 8:30 AM Fed speakers: Musalem (9:30 AM), Goolsbee (1:00 PM) 4-Month Treasury supply (9/08s): 11:30 AM **Bond Pricing** **UMBS 30 yr** | Coupon | Price | Intra-Day Change | | 5.0 | 98.74 | 0.44 | | 5.5 | 100.7 | 0.36 | | 6.0 | 102.26 | 0.25 | **GNMA 30 yr** | Coupon | Price | Intra-Day Change | | 5.0 | 99.42 | 0.38 | | 5.5 | 100.93 | 0.32 | | 6.0 | 102.05 | 0.17 | **Treasuries** | Term | Yield | Price | Intra-Day Yield Change | | 2 yr | 3.874 | 100.003 | -0.068 | | 3 yr | 3.898 | 98.882 | -0.072 | | 5 yr | 4.001 | 99.432 | -0.077 | | 7 yr | 4.177 | 100.44 | -0.067 | | 10 yr | 4.355 | 98.152 | -0.07 | | 30 yr | 4.937 | 97.083 | -0.054 |

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Mortgage Today (PM) - 05/05/26

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May 5, 2026

WTMS Blog Today = What's up in Mortgage Today (PM) - 05/05/2026 Bonds staged a modest recovery today as oil prices stabilized and economic data came in near expectations, but mortgage-backed securities gained less than one-third of yesterday's losses, signaling caution among traders. UMBS 5.0 coupons climbed just 0.14 points, while the 10-year Treasury yield fell only 1.9 basis points to 4.419%, leaving rates vulnerable to renewed selling pressure. The market's tepid response despite favorable data suggests investors are braced for continued volatility, especially with Middle East tensions keeping commodity markets elevated. New home sales surprised to the upside at 682,000 units versus a 650,000 forecast, the strongest signal from today's economic print that housing demand remains intact even at current rate levels. ISM services employment jumped to 48.0 from 45.2, and business activity held steady at 55.9, both reflecting a labor market that shows life despite recent Fed warnings about rate hikes. The trade deficit narrowed to -60.30 billion versus expectations of -60.9 billion, a small win for the administration's trade policy narrative. These benign prints should have helped bonds more, but they didn't, underscoring the reality that rates are now driven more by inflation fears and Fed policy than traditional economic calendars. The bigger story is what's brewing at the Federal Reserve: Neel Kashkari's recent commentary on potential rate hikes has sent Fed Funds futures markets scrambling, with December contract pricing now showing a nearly 30% chance of tightening and only a 6% chance of a cut this year. That shift from accommodative expectations to hawkish repricing happened fast and explains why bond traders are gun-shy despite solid economic momentum. For mortgage originators, this signals that rate locks should be treated as a precious commodity because the window to offer certainty to borrowers is narrowing. The UWM-Two Harbors deal fight continues to escalate in public, with both companies now making their case directly to shareholders as the May 19 vote approaches. UWM is defending its $12 bid by attacking the board's math and process, positioning its offer as offering more value and flexibility, while Two Harbors leans on execution certainty. This fight moving into public shareholder warfare means the outcome is increasingly unpredictable, and industry consolidation—which affects secondary market pricing—now hinges on voter sentiment rather than boardroom negotiation. **Locking vs Floating** Bonds recovered modestly but trails yesterday's selloff by a wide margin, creating asymmetric risk in favor of locking rates. For borrowers with rate certainty in hand, this is a stabilization window to move loans to underwriting before the next leg of volatility hits. Those still shopping should lock now given the Fed's emerging hawkish tilt—improvement is possible but far from guaranteed, and the tail risks are clearly pointed higher. **Today's Events** Trade Gap (Mar): -60.30B vs -60.9B forecast, -57.3B previous S&P Global Services PMI (Apr): 51.0 vs 51.3 forecast, 49.8 previous ISM Business Activity (Apr): 55.9 vs forecast unavailable, 53.9 previous ISM Non-Manufacturing PMI (Apr): 53.6 vs 53.7 forecast, 54.0 previous ISM Services Employment (Apr): 48.0 vs forecast unavailable, 45.2 previous ISM Services New Orders (Apr): 53.5 vs forecast unavailable, 60.6 previous ISM Services Prices (Apr): 70.7 vs 70.7 forecast, 70.7 previous New Home Sales (Mar): 682K vs 650K forecast, 587K previous USA JOLTS Job Openings (Mar): 6.866M vs 6.84M forecast, 6.882M previous **Bond Pricing** **UMBS 30 yr** | Coupon | Price | Intra-Day Change | **GNMA 30 yr** | Coupon | Price | Intra-Day Change | **Treasuries** | Term | Yield | Price | Intra-Day Yield Change | | 2yr | 3.942 | 99.873 | -0.004 | | 3yr | 3.97 | 98.683 | -0.001 | | 5yr | 4.078 | 99.09 | -0.001 | | 7yr | 4.25 | 99.999 | -0.003 | | 10yr | 4.425 | 97.6 | -0.008 | | 30yr | 4.987 | 96.332 | -0.028 | Market Data

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