Two months ago, if someone said oil would be sitting just under $90 a barrel, the reaction would have been a collective gasp of dread.

Funny how quickly things change.

Now the market is practically celebrating oil at $90 a barrel.

Bottom line, the market wants stability. Even a small hint that the Strait could reopen within the next 30 days is enough to give investors some optimism. Let’s cross our fingers and hope cooler heads prevail.

In other news, the upcoming Personal Consumption Expenditures (PCE) inflation report is expected to show headline inflation rising from 3.5% to 3.8% year over year. Under normal circumstances, that would likely pressure both bonds and mortgage rates higher.

But right now, geopolitics and oil are driving the bus. As long as there are no major negative developments surrounding the U.S./Iran peace talks, the market may be willing to look past a hotter inflation reading, at least temporarily.

http://www.YourApplicationOnline.com