MBS Live: MBS Afternoon Market Summary
On a trading day with no meaningful data or events, bond markets went calmly about their business--picked up at least half the pieces from Friday's earth-shattering sell-off.  If we were to combine the two trading days, we now have price levels that are more in line with where an average post-NFP sell-off might have left us.  There's a temptation to do just that considering that many market participants were out on Friday and are ostensibly back in action today, but the latter isn't entirely clear.  Treasuries were slightly better off in terms of volume than the few excruciatingly slow days leading up to the Independence Day break, but still not back to recent averages.  With each warm body being even more important to MBS markets, the light liquidity was more pronounced.  Those left in control in the afternoon were bullishly biased (meaning progressively fewer actual trades were needed to move prices, and in this case, the direction happened to be higher).  We'll take what we can get, but so far, all today does is to make Friday's sell-off look slightly less severe.  Considering the amount of today's bounce back that can be accounted for by short covering (booking profit on bets that rates move higher), this is one of the few times you'd be justified in not being thrilled about a 1 point rally.  It was very incidental, and very lacking in conviction as far as 1pt rallies go.
MBS Pricing Snapshot
Pricing shown below is delayed, please note the timestamp at the bottom. Real time pricing is available via MBS Live.
FNMA 3.0
95-30 : +1-02
FNMA 3.5
99-28 : +0-31
FNMA 4.0
102-31 : +0-29
FNMA 4.5
105-05 : +0-23
GNMA 3.0
96-25 : +1-06
GNMA 3.5
100-21 : +1-06
GNMA 4.0
103-09 : +1-00
GNMA 4.5
105-09 : +0-19
FHLMC 3.0
95-21 : +1-00
FHLMC 3.5
99-19 : +0-31
FHLMC 4.0
102-22 : +0-26
FHLMC 4.5
104-21 : +0-23
Pricing as of 4:04 PM EST
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.
1:46PM  :  MBS Revisit AM Highs; Positive Reprice Potential
While Treasuries continue bouncing along the 2.65 percent range in 10yr yields, MBS look intent to test a new high. Fannie 4.0s are currently right at highs of the day, up 24 ticks at 102-25. Some lenders have already repriced positively on the rally earlier this morning and the possibility stays on the table as those gains have held up nicely so far (4.0s never fell below 102-17 before heading back up to current levels).
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.
Al Bordessa  :  "REPRICE: 2:12 PM - Stearns Lending Better"
Christopher Stevens  :  "REPRICE: 2:11 PM - Chase Better"
benjamin levin  :  "REPRICE: 2:04 PM - Wells Fargo (retail) Better"
Christopher Stevens  :  "REPRICE: 1:14 PM - Wells Fargo Better"
Mike Drews  :  "80% of my business is new construction and i'm already having to restructure deals due to DTI"
Dirk Postupack  :  "Mike...agreed....w/ higher rates brings higher payments to buyers. If they were borderline w/ DTI they could be done now. I see another fall in home prices if this market does not pick up."
Michael Gannon  :  "agree strongly with Mike G....."
Michael Gillani  :  "Even with 3.5% interest rates, we were not seeing any substantial growth so with 5%+ rates it will dramatically slow down forsure. It doesn't matter that they are still historically low either, I'm tired of hearing that argument. We are in an unprecedented bad economy, national debt crisis and jobless situation as well as insanely tight underwriting guidelines which will continue to keep a very heavy weight on the housing market and financing."
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