MBS MID-DAY: 10/7/2011
By:
Matthew Graham
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MBSonMND: MBS MID-DAY
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Morning Market Updates
A recap of MBS Market Updates provided by MND Analysts and streamed live to the MBSonMND Dashboard
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8:57AM :
ALERT:
Non-Farm Payrolls Beat Estimates. Bond Markets Suffer
- Headline NFP up 103k vs 60k estimate
- August and July together were revised 99k higher
- 45k of NFP headline due to returning Verizon workers
Bond markets haven't taken the news well but may be showing signs of stabilizing. 10 yr yields have had a few bounces around 2.10 and are currently at 2.098. Fannie 3.5 MBS are down half a point on the day at 101-20.
We're past the point now of hoping for one of those early bounces back that sometimes occur after a data-inspired knee-jerk reaction, but things could still change quite a bit depending on how the domestic stock session shapes up. If current levels continue to prevail, rate sheets will be significantly worse.
- August and July together were revised 99k higher
- 45k of NFP headline due to returning Verizon workers
Bond markets haven't taken the news well but may be showing signs of stabilizing. 10 yr yields have had a few bounces around 2.10 and are currently at 2.098. Fannie 3.5 MBS are down half a point on the day at 101-20.
We're past the point now of hoping for one of those early bounces back that sometimes occur after a data-inspired knee-jerk reaction, but things could still change quite a bit depending on how the domestic stock session shapes up. If current levels continue to prevail, rate sheets will be significantly worse.
Featured Market Discussion
A recap of the featured comments from the Live Discussion on the MBSonMND Dashboard
.
AQ : "we've seen the selling already. mkt has been buying over last two days."
AQ : "mkt was flat before NFP. This is a drift. Underlying bid is still present in 10s. Fed is still buying TBAs. (10yr flows +800% today on my screens MG) "
Matthew Graham : "as opposed to an outright reversal into an uptrending pattern of yields"
Matthew Graham : "we may test a breakout of the trend channels today, but we'd be hoping to stay under 2.125 as a horizontal pivot that would allow things to stay at least in a sideways holding pattern"
Matthew Graham : "important to note that the highest tick in 10's was just under 2.125. This is a number that has come up a few times in the analysis, and a candidate for the single most important yield level of the past 2 months"
Jeff Anderson : "The trend just defriended me."
John M Roberts - TN Consumer : "no add'l Fed easing indicated by these numbers, wondering how long it will take the markets to decide that makes it a negative"
Brett Boyke : "Having flasback from last fall"
Brett Boyke : "This will set us back for a few weeks at least"
Matthew Graham : "RTRS - U.S. NONFARM PAYROLLS REVISIONS FOR AUG, JULY ADDED 99,000 MORE JOBS THAN PREVIOUSLY REPORTED "
Matthew Graham : "RTRS- U.S. SEPT NONFARM PAYROLLS RISE DUE IN PART TO RETURN OF 45,000 STRIKING VERIZON WORKERS--LABOR DEPT "
Matthew Graham : "RTRS- U.S. SEPT NONFARM PAYROLLS +103,000 (CONSENSUS +60,000) VS AUG +57,000 (PREV UNCH), JULY +127,000 (PREV +85,000) "