MBS Live: MBS Afternoon Market Summary
This morning LOOKED like it might buck the trend and actually provide some semblance of directional movement, but here we are, sideways again. This is now officially the longest stretch in a range this narrow since the mega-rally began in August of 2011. Shortly after the last NFP, we mused over the possibilities to break the monotony with various pieces of upcoming data. The "biggie" was the FOMC day on 4/25, and although it did give us our widest 1-day range, it was a historically tame reaction that placed focus firmly on tomorrow. But even as we said that on the 25th, we didn't think things would turn out to be so profoundly devoid of life right through today! But alas... If NFP leaves us flat tomorrow, we'll really be cranky. Then again, that would mean smooth sailing for rate sheets.
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.
2:21PM :
ALERT ISSUED:
Stocks Skid, Bonds Rally. Limited Positive Reprice Potential
10yr TSYs just tested a breakout of the 1.9172 range resistance that has kept them contained so far today. The longer they hang around those level or better yet, if they break lower, the better the chances for MBS to sustain a break above 103-30 (Fannie 3.5's). At such levels, there's a small chance that a few lenders would offer a token reprice for the better, but we'd generally expect fewer lenders to get involved in such a thing the day before NFP and probably with smaller improvements than otherwise might be offered. Bottom line though, is that you're clear to continue floating until cut-off, if that's your plan. Do keep in mind though, that it's not unheard of for lenders to reprice negatively into an MBS rally if lock volume is high. And it is high today.
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.
Gus Floropoulos : "anything closing in the next 2 weeks needs to be locked, especially purchases....not worth the risk.....we will need major shock value to push through, and a below avg nfp wont do it "
Matthew Graham : "when things seem "clear" and/or "likely" there's a good chance the market is about to have it's way with you. "
Matthew Graham : "the thing that scares me the most is that it FEELS more likely that rates will rally. "
Matthew Graham : "How many NFP days have we seen where the .125 we were hoping for on Thursday afternoon turned into half a point loss on Friday morning, with 2-3 painful hours watching prices plummet? Sure... maybe there's only a 20-30% chance of that happening, but that's a HUGE % chance relative to where it is on most other moments in time. "
Victor Burek : "if jobs report is better than expected, or even close to expectations,, we probably sell off...lots of pent up energy"
Jeff Anderson : "As Hubie Brown would say, not a whole lot of upside to float from here."
Matthew Graham : "to view it as anything else than "risk of loss outweighs benefit of gain,' is to assume a catastrophically awful NFP that creates a vortex of snowball buying sufficient in size to stoke the flames of a liquid 3.0 market. "
Victor Burek : "to clarify my last comment. i would float til end of day..maybe a reprice for the better if we can hold here"
Matthew Graham : "all I know is that we're effectively at all time highs, the next MBS coupon lower is a tough nut to crack, and tomorrow carries big 'potential energy.' "
Matthew Graham : "lock/float suggestions always depend on the scenario. If you had 100 loans to lock, my advise would be very different than if you had 3"
Victor Burek : "under 15 days..no brainer...lock"
John Rodgers : "What do you stand to gain at this point on a short term lock?"
Thomas Nelson : "MG......Any suggestions for locks (short term) based upon job number projections tomorrow?"
Jeff Anderson : "So let's play the NFP Game. Closest to the number w/put going over gets a free month of MND? I say 138k."
Dirk Postupack : "Thanks John....we ran it thru w/ a higher value to see how it would come back....I put in 170K.......findings came back at 129,900 so before I enterd that # i figured ck here 1st. Thanks you john...much appreciated"
john murphy : "Hey DK: have done that a few dozen times. it works, until the DU alogorithim thinks you're playing games, then it drops the hammer back to a 1004, fr a PIW, so be careful. had to tell my LO's to limit the reruns to two w/ value change..."
Dirk Postupack : "Under the new refi plus rules w/ appraisals.....i put in a value higher than what was reported on the findings, and the property is requiring a full appraisal. If I change the value to match the findings will that give me a better chance to get a waiver?"
Michael Mitchell : "Thanks guys"
Michael Mitchell : "February was the best month for this office since 2005. May looks like it will rival it."
Jason Adams : "I am glad you guys are having success. June will be a monster for me as well due to u/w backlog. I am curious how many units you guys are doing a month right now. I am closing 8-12 and cannot seem to get anymore than that out of u/w a month"
Curt Sandfort : "not sure I can say April was my best ever, I've had some pretty ridiculous paychecks back in the day, but April sure was fun."
Curt Sandfort : "my apps were trending down from march to April...time to hit the phones"
Jeff Anderson : "May will be my best month in my 8+ year career. So up."
Victor Burek : "about same"
Brent Borcherding : "Up"
Curt Sandfort : "just a quick temperature gauge here, how is your May looking compared to April? up / down / same?"
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