MBS Live: MBS Afternoon Market Summary
There's little else to say beyond what's said in the most recent update at 1:43pm below. With a low of 103-10, a high of 103-18, and most of the trading range falling within 103-13 to 103-16, today was exceedingly uneventful for MBS. Things were slightly peakier in Treasuries day over day as 10yr yields essentially traversed their entire week's range between yesterday afternoon and today, but they were similarly uneventful from 10am on, holding between 2.0 and 1.98. As we've already noted, we think the market's eyes are turning toward 4/25's FOMC Announcement and Bernanke presser. This afforded an opportunity for this week of trading to close out having held a rather narrow range. We're not sure if the exact same range will prevail next week, but there's a fair chance that things will continue to seem restrained in some way until the following week. As always, such thoughts assume an absence of 'tape-bomb'-style headlines.
MBS Pricing Snapshot
Pricing shown below is delayed, please note the timestamp at the bottom. Real time pricing is available via MBS Live.
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Afternoon Reprice Alerts and Updates
Below is a recap of instant Reprice Alerts and updates issued via email and text alert to MBS Live subscribers this afternoon.
1:43PM :
Volume and Volatility Our For The Weekend. MBS Holding Gains
With more than a little bit of resignation, we commented this morning on the sense that the current range trade in bond markets won't get its most potent bit of information until the April 25th FOMC Announcement, and that 10yr yields, by default, seemed stuck in a 2.07-1.96 range until then.
Even though some headline events could nudge us out of that range between now and then, "relatively flat, and wholeheartedly uncommitted" feel like the dominant themes since last week's NFP miss. Today has played out perfectly in that regard inasmuch as 10yr yields approached 2.07 yesterday afternoon and are heading decidedly back into the range ever since, but clearly bottoming out before testing Tuesday's lows.
If you caught the Zombie Movie reference the other morning, markets basically made us wait one more day before another "red oval." (i.e. monday=flat, tue=directional, wed, thur=flat, today=directional). The downside to that is that we got the same main line of resistance at 1.98+, translated to 103-17 in terms of Fannie 3.5 MBS. The upside is that these prices are just fine... 8/32nds up on the day.
Volume has dropped off in characteristic Friday afternoon fashion and we're not expecting any meaningful developments in the big picture. Other than the need to maintain a simple level of awareness that low volume can lead to volatility, the week is over. Key reprice risk level underfoot at 103-10 (we're currently at 103-14).
Even though some headline events could nudge us out of that range between now and then, "relatively flat, and wholeheartedly uncommitted" feel like the dominant themes since last week's NFP miss. Today has played out perfectly in that regard inasmuch as 10yr yields approached 2.07 yesterday afternoon and are heading decidedly back into the range ever since, but clearly bottoming out before testing Tuesday's lows.
If you caught the Zombie Movie reference the other morning, markets basically made us wait one more day before another "red oval." (i.e. monday=flat, tue=directional, wed, thur=flat, today=directional). The downside to that is that we got the same main line of resistance at 1.98+, translated to 103-17 in terms of Fannie 3.5 MBS. The upside is that these prices are just fine... 8/32nds up on the day.
Volume has dropped off in characteristic Friday afternoon fashion and we're not expecting any meaningful developments in the big picture. Other than the need to maintain a simple level of awareness that low volume can lead to volatility, the week is over. Key reprice risk level underfoot at 103-10 (we're currently at 103-14).
Live Chat Featured Comments
A recap of the featured comments from the MBS Live Dashboard's Live Chat feature, utilized by hundreds of industry professionals each day.
Patrick Waldron : "I've definitely noticed a very professional air in the room. There's the jokes and kidding but almost everyone has spoken about how important their customers are in the end. Speaking as an outsider, I can't begin to tell you how many warm fuzzies this has given me. And a big thank you to Matt Graham as well for writing some of the easiest to understand knowledge articles."
Victor Burek : "but nothing wrong locking in at today's rates...always better to lock when you should have floated, then to float when you should have locked"
Matt Hodges : "Patrick - no one knows. if the rate/points meet your expectations, lock. If your loan officer offers a float down, that's a positive"
Victor Burek : "tough question Patrick..if you feel the economy is gonna get worse here or in europe, float away..if you feel the economy is getting better, pay the premium and lock"
Brent Borcherding : "You'll get a wide range of answers, but I'd float."
Patrick Waldron : "Or that the COST of a 60 day lock isn't worth the money spent on it?"
Patrick Waldron : "Folks, I am but a lowly soon-to-be homeowner so quite a bit of this is over my head. I've read and re-read the basics and knowledge articles posted here (INCREDIBLY helpful) in search of an answer to this question, but haven't found it: Is the general consensus to float for the next 60 days based off of the expectation that rates will continue to improve from here..."
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