There are more newswires out of the EU than you can shake a stick at
this morning. In what has to be one of the most anticlimactic
resolutions to a hotly-anticipated event, we begin the domestic session
with glut of headlines that seem to be some sort of CONCLUSION to the EU
Summit.
As it turns out, markets unwittingly already spent much
of the week reacting to today's summit decisions through the course of
the week based on various speculation and credible "leaks." Apparently,
markets did a good job of this despite the low volumes as trading levels
are little changed from yesterday afternoon. 10yr yields moved as high
as the 2.02's overnight, but are back to 1.99 currently. MBS are
unchanged at 102-10.
The most striking thing about these levels
is that they're very much INSIDE yesterday's trading range--not at all
the sort of thing one would expect for all the build-up over the EU
summit. This adds to the impression that markets traded this event to a
large extent yesterday, as that was basically the week's most
directional move. But the day is young and a move outside yesterday's
range could still be in the cards by the time the multitude of details
from the Summit are considered.
International Trade and Consumer
Sentiment are the only two domestic releases of the day. The former
just reported roughly in line with consensus ($43.47 bln vs $43.50 bln
forecast). Sentiment is forecast at 65.5, and scheduled for 955am.
Here's a look at how things are shaping up this morning from the MBS Live Dashboard: