Core Viewpoint - Annaly Capital Management's performance is closely linked to mortgage rates and Federal Reserve policy, with current trends indicating challenges due to rising mortgage rates and economic uncertainty [1]. Mortgage Rate Trends - Mortgage rates have recently increased, with the 30-year fixed mortgage rate reaching 6.38% as of March 26, 2026, up from 6.22% the previous week and down from 6.65% a year ago [2]. - The rise in mortgage rates is attributed to concerns over inflation and geopolitical tensions, particularly in the Middle East, which have kept Treasury yields elevated [3]. Impact on mREITs - Higher mortgage rates, combined with affordability issues and economic uncertainty, are pushing potential homebuyers away, creating operational challenges for mREITs like Annaly, AGNC Investment Corporation, and Starwood Property Trust [3]. - The Federal Reserve's decision to maintain steady interest rates in 2026, despite previous cuts, is expected to increase earnings pressure on highly leveraged mREITs, potentially leading to reduced dividends [4]. Performance Factors for Annaly - Annaly's diversified investment platform includes Agency mortgage-backed securities (MBS), residential credit, and mortgage servicing rights (MSR), which aids in balancing income generation and risk management [6]. - As of December 31, 2025, Annaly's investment portfolio was valued at $104.7 billion, with $92.9 billion in highly liquid Agency MBS, which are primarily backed by government-sponsored enterprises [7]. - The company is expanding its MSR platform through a partnership with PennyMac Financial Services, enhancing its operational efficiency [8]. Financial Position and Dividends - Annaly maintains a strong liquidity position with $9.4 billion in total assets available for financing, including $6.1 billion in cash and unencumbered Agency MBS [10][11]. - The company has a current dividend yield of 13.5%, having increased its quarterly cash dividend by 7.7% to 70 cents per share in March 2025 [12]. Sales and Earnings Estimates - The Zacks Consensus Estimate for Annaly's 2026 sales indicates a year-over-year growth of 74%, with expected sales of $1.98 billion [15]. - Earnings estimates for 2026 suggest a year-over-year growth of 1.4%, while a slight decline is anticipated for 2027 [18]. Stock Performance and Valuation - Annaly's shares have gained 2.3% over the past year, outperforming the industry's decline of 6.5% [21]. - The stock is currently trading at a forward 12-month price-to-tangible book (P/TB) multiple of 1.01X, which is higher than the industry average of 0.91X [23].

Economic Outlook - The OECD forecasts U.S. inflation to be at 4.2% for 2026, a significant increase from the previous projection of 2.8% [1][2] - This revised inflation forecast is higher than the Federal Reserve's estimate of 2.7% [2] Factors Influencing Inflation - The increase in inflation is attributed to the ongoing war in the Middle East and the impact of U.S. tariffs, which continue to affect global prices [2] - A prolonged period of higher energy prices is expected to increase business costs and consumer price inflation, potentially hindering economic growth [3] Future Projections - U.S. inflation is anticipated to decrease sharply to 1.6% in 2027, which is below the Fed's estimate of 2.2% and the central bank's 2% target [4] - Core inflation, excluding energy and food prices, is projected at 2.8% for this year and 2.4% in 2027 [4] Federal Reserve Policy - The OECD expects the Federal Reserve to maintain its policy rate flat through 2027 due to rising headline inflation and core inflation remaining above target [5] - The organization emphasizes the need for vigilance against inflation threats by the Fed and global counterparts [5] GDP Growth - The OECD projects U.S. GDP growth to accelerate at a rate of 2% this year, easing to 1.7% in 2027, following a slowdown to 0.7% in the fourth quarter of 2025 [6]

Core Insights - Home equity line of credit (HELOC) rates have dropped to their lowest level since 2022, with a current rate of 7.04%, down 13 basis points from the previous week [1][2] - Homeowners are sitting on significant equity, with many planning upgrades or changes, but are waiting for favorable conditions to act [2] - The Federal Reserve's policy and inflation expectations are the primary drivers of home equity rates, with current rates expected to remain stable for the foreseeable future [3][4] Group 1: Current Rates - The current HELOC rate is 7.04%, down from 7.32% four weeks ago and 8.01% a year ago, with a 52-week average of 7.88% [2] - The five-year home equity loan rate remains unchanged at 7.85%, compared to 7.87% four weeks ago and 8.37% a year ago [2] - Other home equity loan rates include 10-year at 8.00% and 15-year at 7.97%, both showing slight decreases from previous weeks [2] Group 2: Market Drivers - The Federal Reserve's decision to keep rates unchanged is expected to maintain current home equity borrowing rates, which are near three-year lows [4] - Inflation and geopolitical tensions, particularly the ongoing war in Iran, are influencing the Fed's approach to rate cuts, which are now expected to be less aggressive than previously predicted [4] - The relationship between home equity rates and other types of credit is highlighted, as HELOCs and home equity loans are generally less expensive due to being secured by the home [5]

Group 1 - The 200-day EMA holding is seen as a strong indicator, but recent developments regarding U.S.-Iran communications have created uncertainty in the gold market [1] - Interest rates in the U.S. are a significant factor, with the 10-year rate hitting 4.43%, which is expected to negatively impact gold prices and strengthen the U.S. dollar [2] - The current market environment suggests caution, as there are numerous risks that could adversely affect investments, particularly with unpredictable headlines influencing market movements [3]

Core Insights - Home equity line of credit (HELOC) rates have slightly decreased to 7.17%, the lowest in over three years, while five-year home equity loan rates increased to 7.85% [1][3] - The Federal Reserve's decision to keep interest rates unchanged is influencing home equity borrowing rates, which are expected to remain stable for the foreseeable future [4][5] Rate Summary - Current HELOC rate is 7.17%, down from 7.31% four weeks ago and 8.03% a year ago, with a 52-week average of 7.90% and a low of 7.17% [3] - The five-year home equity loan rate is currently at 7.85%, slightly up from 7.89% four weeks ago and down from 8.37% a year ago, with a 52-week average of 8.14% and a low of 7.84% [3] - Other home equity loan rates include 10-year at 7.99%, 15-year at 7.97%, both showing slight fluctuations compared to previous weeks and months [3] Influencing Factors - Home equity rates are primarily driven by Federal Reserve policy and long-term inflation expectations, with the Fed monitoring inflation and the job market [4] - Current geopolitical tensions and persistent inflation are expected to limit the Fed's ability to cut rates aggressively, suggesting that rates may not change significantly in the near future [5]

Corporate Performance - Micron Technology (MU) is scheduled to report its quarterly results after the market close on Wednesday [4] - General Mills (GIS) and Macy's (M) are also set to report their earnings on the same day [4] Industry Trends - Wholesale inflation increased by 0.7% month-over-month in February, indicating rising inflationary pressures [2] - The conflict in the Middle East has led to heightened market volatility, particularly affecting oil prices [3] - Brent crude futures rose to $104 per barrel, while West Texas Intermediate crude futures traded near $98, reflecting ongoing concerns about supply disruptions [3]

No movement for home equity rates in the latest week. The $30,000 home equity line and the five-year $30,000 home equity loan were unchanged, holding at 7.18% and 7.84%, respectively, according to Bankrate’s national survey of lenders. As home equity rates remain at their lowest level in three years, a HELOC can be a good option for homeowners who have a lot of equity in their homes and upcoming expenses, says Jeff DerGurahian, chief investment officer and head economist at loanDepot. “Maybe you got a m ...

Core Insights - Home equity rates are currently mixed, with the home equity line of credit (HELOC) at 7.32% and the five-year home equity loan at 7.87%, both near their lowest levels in about three years [1][3] - Homeowners are increasingly tapping into their home equity for renovations and projects, leveraging the significant equity growth since 2020 without selling their homes or losing their low first mortgage rates [2][3] Home Equity Rates Overview - The current HELOC rate is 7.32%, down from 7.44% four weeks ago and 8.12% a year ago, with a 52-week average of 7.95% and a low of 7.31% [3] - The five-year home equity loan rate is 7.87%, down from 7.92% four weeks ago and 8.40% a year ago, with a 52-week average of 8.17% and a low of 7.87% [3] - Other home equity loan rates include 10-year at 8.07% and 15-year at 8.06%, both showing slight decreases from previous weeks [3] Factors Influencing Home Equity Rates - Home equity rates are primarily influenced by Federal Reserve policy and long-term inflation expectations, with the Fed maintaining interest rates in its recent meeting [4] - Forecasts suggest the Fed may implement three quarter-point cuts in 2026, as inflation moderates and the job market stabilizes [4][5] - Home equity rates are generally lower than unsecured credit options, such as credit cards (19.59%) and personal loans (12.26%), due to the collateralization of home equity [6]

Core Viewpoint - Annaly Capital Management's performance is closely linked to mortgage rates and Federal Reserve policies, with recent trends indicating lower mortgage rates which may enhance housing affordability and support growth in home purchases and refinancing activities [1][2]. Mortgage Rates and Federal Reserve Policy - Mortgage rates have decreased to 6.09% as of February 12, 2026, down from 6.11% the previous week and significantly lower than 6.87% a year ago [1]. - The Federal Reserve has maintained its benchmark federal funds target range at 3.50-3.75% and is expected to implement two 25-basis-point rate cuts later in 2026, which will reduce funding costs for mortgage REITs [3]. Financial Performance - Annaly's net interest income (NII) rose to $1.14 billion in 2025 from $247.8 million the previous year, reflecting improved earnings due to lower funding pressure [3]. - The Zacks Consensus Estimate for Annaly's 2026 sales indicates a year-over-year growth of 74%, with projected sales of $1.98 billion [16]. Portfolio Diversification - Annaly operates a diversified investment platform that includes Agency mortgage-backed securities (MBS), residential credit, and mortgage servicing rights (MSR), which aids in balancing income generation and risk management [5]. - As of December 31, 2025, Annaly's investment portfolio totaled $104.7 billion, with $92.9 billion in highly liquid Agency MBS, primarily rated 'AAA' [6]. Strategic Initiatives - The company is expanding its MSR platform through a long-term agreement with PennyMac Financial Services, enhancing its servicing capabilities and operational efficiency [7]. - Annaly has exited its commercial real estate and Middle Market Lending businesses to focus on core housing finance operations, allowing for more concentrated capital deployment [8]. Liquidity and Capital Distribution - Annaly maintains a strong liquidity position with $9.4 billion in total assets available for financing, including $6.1 billion in cash and unencumbered Agency MBS [10]. - The company has a current dividend yield of 12.14%, having increased its quarterly cash dividend by 7.7% to 70 cents per share in March 2025 [12]. Market Performance - Annaly's shares have increased by 11.8% over the past six months, outperforming the industry average of 5.7% [20]. - The stock is currently trading at a forward 12-month price-to-tangible book (P/TB) multiple of 1.12X, which is higher than the industry average of 1.05X [23].

The January jobs report came in very very strong. But the question is, is this the start of a trend or was this a one-mon aberration. So what we saw is that job growth ticked up 130,000 jobs in January, which was really, really a good month.Expectations had been far lower than that. Somewhere in the neighborhood of 55 to 60,000. This was the best single month of job growth that we've seen since 2024.Part of the reason this jobs report was sort of surprising was because 2025 was such a dismal year. And there ...