Stocks are still in rather heady territory with both the Dow and S&P 500 closing at record highs. The Dow finished up 33.27 to close at 177719.00 and the S&P 500 up 4.03 to finish out at 2052.75. Markets continue to march ahead in spite of geopolitical events and a weakening European Market. Chinadow up rates hold steady has also been a concern. Some may see a correction coming as the S&P 500 P/E ratio hit 19.12 last week. One year ago, the same index was at 18.85.

Manufacturing activity grew at the fastest clip in twenty years and home sales for October came in stronger than expected. The Philly Fed Index came in at 40.8 for November, way higher than the 18.3 expected. The economy continues to show signs of strength yet other markets around the globe aren’t following suit. This will of course slow down exports as foreign economies continue their weak showing and the dollar strengthening still.

In spite of this activity, or maybe in line with it, mortgage backed securities are still holding their ground. At the end of trading today, the 30 year FNMA 3.5 coupon hit 103.17, keeping mortgage rates in check. 15 year fixed rate conforming rates for real estate investors can be found from 3.50 to 3.75%.

Economic reports for the month of November will be released next month and with the powerful cold fronts shutting down highways, airports and shopping malls coupled with next week being a short week, the numbers may be skewed, keeping interest rates in their current range.