The overnight session was moderately strong for Treasuries, helped along by slumping stocks in Asia and rallying bond markets in Europe.  We have seen some benefit from Ukraine headlines today, but in a supporting rather than starring role.

MBS finally began keeping better pace with Treasuries this morning, but in the past few hours.  Bond markets in general have been following equities and they both spiked together (bonds stronger, stocks weaker) on news of a building explosion in New York.  Keep in mind that there are trading programs that will simply buy bonds and/or sell stocks if certain words appear in headlines or even on Twitter. 

As more information came out on the explosion, markets bounced and began heading in the other direction (stocks stronger, bonds weaker).  During this most recent move, MBS have been the most resilient with prices only a tick lower than the predominant morning higher (104-04 in Fannie 4.0s currently vs 104-05 for most of the 10am hour).  Treasuries are still in positive territory, but 10yr yields are off their 2.714 lows, up to 2.741 now.  Some of the relative weakness could be accounted for by the 10yr Note auction coming up at 1pm.