There were no whammies last week as bonds drifted sideways to slightly stronger in a narrow range. The new week/month began with an unpleasant double whammy, unfortunately, due to positioning and economic data. Traders began selling in waves right out of the gate. The first two waves (8am and 8:20am) were best explained by traders closing out last week's 3.5-day weekend protections and other traders opening new positions for the month of April. Additional selling followed the stronger PMI data (both from S&P and ISM) which included higher price components. Longer-dated Treasuries fared much worse at first, but short-term yields closed the gap a bit by the afternoon. All told, 10yr yields jumped more than 12bps to close just over the 4.32% technical level. MBS lost roughly half a point by 4pm.
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- ISM Manufacturing PMI
- 50.3 vs 48.4 f'cast, 47.8 prev
- ISM Prices Paid
- 55.8 vs 52.7 f'cast, 52.5 prev
- ISM Manufacturing PMI
Roughly unchanged overnight, but sharply weaker since 8am, especially for the long end of the curve. MBS down 5 ticks (.16) and 10yr up 5.6bps at 4.257.
Bigger sell-off after ISM data. MBS down almost half a point. 10yr up 11.5bps at 4.316.
Fairly flat at the weakest levels. MBS down a half point. 10yr up 12.5bps at 4.326
MBS Market Alerts
