You couldn't swing a dead cat without hitting a news story about the Snapchat IPO or a friend/colleague asking if you were going to buy some.  While it's tempting to explain lower stock and bond prices by saying that everyone sold assets in order to buy snapchat, that's actually not what happened.

Explaining today's market movement with Fed rate hike expectations is a far easier task--largely because if you chart rates and expectations, the lines are obviously moving together.  

As the chart suggests, it was Tuesday afternoon's comments from Fed's Dudley that did the most damage.  Correlations were even stronger today though (notice how all three lines stay on top of each other after meeting up yesterday afternoon).  In essence, the Dudley reaction left longer-term rates feeling increasingly sensitive to short term rates and Fed expectations.

The overnight session offered headlines from another Fed board member, Lael Brainard.  More than a few market participants figure Brainard's comments were important because she's a long-standing dove who finally said it was about time to hike.  While I can appreciate the logic behind those assumptions, I would offer the counterpoint that Brainard's opinion isn't going to sway the rest of the Fed.  If we already have Yellen and Dudley on recent record in strong support of a hike, Brainard's evolution of thought doesn't really add to the alarm.

Even so, it added a modest amount of weakness overnight.  Slightly more noticeable was the reaction to another board member, Powell, who told CNBC that "the case for a rate increase in March has come together."  Those words came in the middle of a rather logical and blunt assessment of the economy and risks.  The takeaway was "we'd be dumb to not hike in March."  To me, it sounded like a done deal.  Markets thought so too, and priced just a bit more certainty of March hike into the bonds and Fed Funds Futures.

We recovered marginally into the late afternoon with 10's ending the day up 2.35bps at 2.4815 and Fannie 3.5s down 6/32nds at 101-26.