In overnight trading Asian markets moved lower while European equities traded marginally higher. US Futures indicate a negative open as many market participants continue to question the health of the banking sector.Several companies have reported their 1Q earnings...the common theme among reports is the inability for firms to present a clear estimate of future earnings expectations. Unknowns are to be expected with the economy and banking sector both "walking a tightrope" of recovery and further contraction.
The yield curve began to steepen late yesterday evening but has flattened out a few bps early in the domestic trading session. MBS may have some room to continue its current uptrend trend but we are quickly nearing a crossroads as "up in coupon" positions are quite rich (losing their appeal to prepay anxious accounts) and production MBS coupons are "running out of room" to move much higher. Check out the chart we posted last night for an illustration of production MBS coupons "running out of room"
Early in the session mortgages appear to be setting themselves up for another quiet day as there isnt much on the economic calendar and Fed speak is mostly muted. Treasury Secretary Timmy will however give testimony regarding the use of funds provided by the Emergency Economic Stabilization Act. Here is the letter written to the Congressional Oversight Panel by TIIMMMAAAYYYY....
Since 5pm "Going Out" Marks....
FN30_______________________________
FN 4.0 -------->>>> +0-01 to 100-02 from 100-01
FN 4.5 -------->>>> +0-03 to 101-30 from 101-27
FN 5.0 -------->>>> +0-02 to 103-01 from 102-31
FN 5.5 -------->>>> +0-02 to 103-24 from 103-22
FN 6.0 -------->>>> +0-00 to 104-16 from 104-16
GN30_______________________________
GN 4.0 -------->>>> +0-00 to 100-06 from 100-06
GN 4.5 -------->>>> +0-03 to 102-07 from 102-04
GN 5.0 -------->>>> +0-02 to 103-18 from 103-16
GN 5.5 -------->>>> +0-00 to 102-30 from 103-30
GN 6.0 -------->>>> +0-00 to 104-11 from 104-11
EFFECTIVE FED FUNDS: +0.01 to 0.14 from 0.13
LIBOR FIXINGS
O/N LIBOR: -0.0100 to 0.2125 from 0.2225
1 MONTH: -0.0012 to 0.4412 from 0.4425
3 MONTH: -0.0006 to 1.1000 from 1.1006
6 MONTH: +0.0006 to 1.6506 from 1.6500
1 YEAR: +0.0044 to 1.9494 from 1.9450
MBS Market Alerts
