MBS were higher today, but for the week as a whole, they've been flat (and right in line with last Friday's levels as of this afternoon). That doesn't seem like a coincidence based on tomorrow's jobs report, but it still might be! We just haven't seen enough evidence of the market's willingness to react to econ data recently.
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20min of Fed 30yr UMBS Buying 10am, 1130am (M-F) and 1pm (T-Th)
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Jobless Claims 1.186m vs 1.415m f'cast, 1.435m prev
Modest gains in Asia and slightly better gains in Europe for bonds overnight. The strength generally correlated with stock market weakness. 10yr yields starting almost 3bps lower and 2.0 UMBS starting almost an eighth of a point higher.
Early weakness erased, and for no particular reason apart from traders rejecting a move above .53% in 10yr yields. Now at new lows for the day of .5134--right in line with yesterday's lows. MBS back near highs, up an eighth on the day. All this despite a full reversal of overnight stock market weakness since 8am.
Treasuries have given up most of their gains (now down only 1bp at .54). The losses correlated with gains in equities. MBS are outperforming despite coming off their highs just slightly. 2.0 UMBS are still up an eighth on the day. Credit goes to lower supply at today's Fed buying operation.
MBS at highs of the day heading into the close, still outperforming Treasuries.
MBS Market Alerts
