If you already had a rate sheet before 10:30 this morning, there's a possibility it's susceptible to reprices for the worse as MBS have fallen to their lows of the day at 101-18 in Fannie 3.5's. These are basically two day lows and rate sheet risks/damage really picks up as we approach 101-16. Still a bit early to PLAN on reprices but they'll be more and more likely the longer MBS go without rising back above 101-19. (caveat: that applies to lenders out with rates before 10:30am).

US Bond Markets have definitely been taking their cues from German Bunds and the Euro. The following article discusses some of the key events overnight and from this week in general that have been impacting the latter and therefor, the former (in general, any discussion of Treasury or Bund "futures" will be speaking in terms of PRICE. So the reference to Bund futures falling equates to rising yields/falling MBS prices):

(Reuters) - German Bund futures fell on Friday on speculation the European Central Bank could lend money to the IMF to bail out bigger euro zone economies, although ECB officials and Germany continued to resist pressure for the bank to play a bigger anti-crisis role. The speculation coincided with a sharper move lower in Italian and Spanish yields after they came off the day's highs as the ECB intervened in the secondary market.

News agency Dow Jones reported that talks on ECB lending to the International Monetary Fund may start soon and that Germany and the ECB were still opposed to the idea but may be willing to consider it, citing sources.

The ECB is reluctant to take on a bigger role for fear of undermining its independence from politics and its price stability mandate when euro zone inflation is at 3 percent -- above its target of just below 2 percent. ECB chief Mario Draghi told euro zone governments on Friday to act fast to get their EFSF rescue fund up and running, showing exasperation at their slow progress. Other senior ECB policymakers joined Draghi in pushing the governments to act, saying the central bank should be asked to go beyond its inflation-busting mandate.

Bond strategists in a Reuters poll saw an even chance of a bigger role for the ECB. The 50 analysts surveyed gave a median 48 percent probability the ECB will be forced to adopt a policy of quantitative easing while a slim majority bet it could become a lender of last resort.

LPS "First Look" Mortgage Report: October Month-End Data Shows an Increase in Foreclosures

• Total U.S. loan delinquency rate (loans 30 or more days past due, but not in foreclosure): 7.93%
• Month-over-month change in delinquency rate: -2.0%
• Year-over-year change in delinquency rate: -14.6%
• Total U.S foreclosure pre-sale inventory rate: 4.29%
• Month-over-month change in foreclosure presale inventory rate: 2.5%
• Year-over-year change in foreclosure presale inventory rate: 9.4%
• Number of properties that are 30 or more days past due, but not in foreclosure: (A) 4,088,000
• Number of properties that are 90 or more days delinquent, but not in foreclosure: 1,759,000
• Number of properties in foreclosure pre-sale inventory: (B) 2,210,000
• Number of properties that are 30 or more days delinquent or in foreclosure: (A+B) 6,298,000
• States with highest percentage of non-current* loans: FL, MS, NV, NJ, IL
• States with the lowest percentage of non-current* loans: MT, WY, SD, AK, ND

*Non-current totals combine foreclosures and delinquencies as a percent of active loans in that state.

A familiar cast of "risk-on" characters combined to help stock futures, the Euro, and Treasury yields climb higher last night. MBS opened about 4 ticks lower than yesterday's 5pm levels and are currently at 101-24. S&P futures are currently in the mid 1220's after falling below 1210 yesterday and 10yr yields are just over 2% after falling just below 1.95 yesterday and again earlier in the overnight session.

But shortly after 3am New York time, the "risk-on" light started getting brighter amidst decent, but not overwhelming volume. Beyond the obvious technical considerations of both US Stocks and 10yr yields hitting their November lows yesterday as well as the fact that it just "feels like it was about time for" a reversal of the risk-off trading of European headlines based on recent runs in sovereign debt spreads and the like, a few market movers to note from the overnight session include:

- ECB chief Draghi calls on EU governments to act quickly in utilizing the EFSF bailout fund

- This also fueled earlier speculation that the ECB will soon be directly injecting capital as opposed to buying EU debt

- Speaking of which, the ECB continues to buy EU Debt, a fact that buoyed sovereign debt overnight

- Germany's Schaeuble says Greece is a one-of-a-kind issue

There's really nothing on tap as far as economic data today. It's a longshot for Leading Indicators at 10am to ever be a market mover and the first instance of Fed Speak from NY Fed's Dudley is already out with no market reaction. With 10yr yields around 2%, we're already seeing much of the correction we (probably) expected after yesterday's technical wall was hit, and could really go either way from here.