Rate sheet influential MBS coupons are venturing into positive territory as stocks shed modest gains and benchmark Treasuries recover from early session weakness.

The Fannie Mae 4.0 MBS coupon is currently bid above 100-24 technical resistance, now +3/32 at 100-28. After moving to the widest yield spreads of the year late last week, current coupon MBS are outperforming benchmarks today in a light trading environment. I've got the current coupon marked at 3.891%. +92/10yTSY. +81.3/10yIRS, +232/5y10y blend. 

The 10-year note is +1/32 at 101-11 yielding 2.969% after trading as high as 3.01% in early action. In the chart below you can see a few technical trendlines. For the time being the most important layer of support is found at 3.02%. We call this our rally "Lift-Off" level. Failure to hold this support level would lead us to believe that a test of 3.09% was possible, which could lead the Fannie Mae 4.0 as low as 100-12. 3.04% would be an important inflection point along the way...

Based on our sampling of rate sheets from the five major lenders, these MBS appreciations are enough to warrant reprices for the better. We've actually already seen one "hair-trigger" lock desk recall rate sheets and re-issue for the better. With that in mind, if these intraday improvements hold, we'd expect to see more reprice announcements.