MBS OPEN: Flight to Safety Leads Rates Lower

The FN 4.0 is +0-09 at 100-06 yielding 3.989% and the FN 4.5 is +0-03 at 102-13 yielding 4.206%.

The secondary market current coupon is 3.989%. I thought about adding the FN 3.5 into the current coupon blend,  but there isn't much of a market for FN 3.5s so I am letting the FN 4.0 carry the entire weight of the calculation.The more important thing to note is that MBS are being outperformed by flight to quality benefited benchmarks.

The CC is now +76/10yr TSY and +66/10yr swap...rate sheet influential yield spreads are wider.

Stocks are weaker after  Dubai's Supreme Fiscal Committee announced they would ask creditors of Dubai World, the emirates investment arm,  to defer for six months at least some of $60 billion owed to them.

The SHANGHAI closed -2.36%, HANG SENG -4.84%, TOPIX -2.24%, NIKKEI -3.22%, DAX +0.26%, CAC +0.47%, and FTSE +0.21%. The effect of the news on US stocks and bonds is obvious when looking at charts...

Stock's lower...

Rates lower...

Are you working today????