Before The Action

It's too early for a comment on the MBS market to be of great importance just yet.  We are still waiting on the Leading Indicators report for another hour.  Concomitantly, the stock market has not opened yet, though futures point to a lackluster opening.

In addition, there is mounting concern by the market bulls (who had their blinders on during this recent stock rally from 12k to 13k), that the credit crunch persists.  Other blind bulls feel that we will merely pause on our way up as stocks continue the rally.

Lowes was out with slightly better than expected earnings this morning, but gave cautionary guidance causing that stock to lose some ground this morning, and putting a slightly bitter taste in the mouthes of equities traders this morning.

All this has MBS trading slightly better this morning with the 5.5% coupon at 100-18, an improvement of  5/32nds from last Friday, and dead even with where trading opened an hour ago.

Stay tuned for an update when the LEI comes out and when stocks have had some time to trade.