It was a classic risk-off trade today, albeit with a certain level of exhaustion on the part of US bond markets.  "Risk-off" means what it says: investors are moving money into less risky investments.  Selling stocks and commodities, or buying bonds are all quintessential 'risk-off' trades. 

There's no question that stocks were sold.  Here's a fun fact: by a very small margin, the S&P just had its worst day since November 2011!  Normally, we'd expect to see a little more love for bonds when that happens, but we can cut them some slack.  MBS and Treasuries are coming off a pretty great day yesterday, not to mention the fact that today's gains brought them to their best closing levels in more than 3 months.  A little exhaustion is understandable in that case.

Even then, today's rally wasn't too shabby.  Fannie 3.5s added 6/32nds and 10yr yields dropped 5.6bps.  Economic data was generally stronger, with both Philly Fed and Existing Home Sales beating expectations at 10am.  The fact that bonds made another move into stronger territory is more evidence that the global risk-off sentiment was in the driver's seat. 


MBS Pricing Snapshot
Pricing shown below is delayed, please note the timestamp at the bottom. Real time pricing is available via MBS Live.
MBS
FNMA 3.0
100-29 : +0-07
FNMA 3.5
103-32 : +0-06
FNMA 4.0
106-15 : +0-03
Treasuries
2 YR
0.6570 : -0.0040
10 YR
2.0730 : -0.0560
30 YR
2.7450 : -0.0710
Pricing as of 8/20/15 7:00PMEST

Today's Reprice Alerts and Updates
A recap of Alerts and Updates provided to MBS Live subscribers.
10:07AM  :  Bond Markets Undecided on Reaction to 10am Data

MBS Live Chat Highlights
A recap of featured comments from the Live Discussion on the MBS Live Dashboard.
Hugh W. Page  :  "We hit 2.04 a week ago and then closed that day at 2.17. We need to go and stay a little lower to make me more floaty"
Jason Anker  :  "April 30th from what I can tell"
Compliance is Watching Me  :  "closing below 2.1 would be great"
Jason Anker  :  "today could be the 1st day we close below 2.1 in a very long time"
Steve Chizmadia  :  "I'm thinking today is a great day to lock. "