Stocks are higher today as the market gains hope for a debt ceiling deal. House Speaker Kevin McCarthy said he was hopeful a deal could be reached by the end of the week & he believed that there would be no default. The threat of a default had weighed down stocks so far this month, with $DIA down over 3% on the month.

For economic data today, housing starts rose 2.2% in April to an annual rate of 1.40 million. Single-family starts increased 1.6% to an annual rate of 846,000. Building permits fell 1.5% to an annual rate of 1.42 million due to a significant decline in multifamily permits.

Elsewhere, MBA mortgage applications fell 5.7% last week as purchase applications fell to the slowest pace in a month. Purchase apps were down 4.8% & refinance apps were 7.7% lower. The report also showed that the average rate of a 30-year mortgage rose 9 points to 6.57%.

Treasury yields are flatter, with the 2-year T yield up 3.6 basis points to 4.11%, the 5-year T yield up 1.8 basis points to 3.54%, and the 10-year T yield down 0.4 basis points to 3.55%. Shorter-term advance rates are lower, while longer-term rates are higher today.