MBS RECAP: 3/1/2012
By:
Matthew Graham
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MBS Live: MBS RECAP
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Afternoon Market Updates
A recap of MBS Market Updates provided by MND Analysts and streamed live to the MBS Live Dashboard.
3:25PM :
ALERT:
MBS and Treasuries at Day's Best Levels After Hours
Fannie 3.5's are at their best levels of the day, down only 5 ticks at 103-08 and 10yr yields are in line with their opening lows in the mid 2.02's. There was a minor volume uptick into the 3pm Treasury close and a somewhat brisk moment of selling in stocks. Too soon to know whether or not improvements in bond markets will continue from here, but if they do, some of the early-crowd might reprice for the better this afternoon.
1:59PM :
Bearish Trend in Bond Markets Has Bulls Against The Ropes
excerpt from the most recent MBS Commentary post:
MBS continue to trade in the red into the afternoon basically in the same range as this morning. Despite the jump lower in prices today, we're still trading yesterday's events and momentum, while today's economic data and events, if anything, have served to reinforce the technical support levels that we already stood a good chance of seeing.
The technical landscape has definitely been fascinating, if not somewhat boring and dare we say, predictable?! Granted, relatively big losses in MBS are never boring in terms of the damage done to rate sheets, but Fannie 3.5's continue to trade over 103-00! If the big picture is of any consolation to you, that's about a point higher than 2010's best levels. The 103-00 level was also the next logically supportive pivot point after breaking 103-10 at the open.
Bottom line: down, but not out. This week is pretty much over if volume is any indication. Next week's NFP as well as the expiration for Greece's private sector bond swaps will very likely cast the deciding votes in the various battles outlined in the following commentary:
MBS continue to trade in the red into the afternoon basically in the same range as this morning. Despite the jump lower in prices today, we're still trading yesterday's events and momentum, while today's economic data and events, if anything, have served to reinforce the technical support levels that we already stood a good chance of seeing.
The technical landscape has definitely been fascinating, if not somewhat boring and dare we say, predictable?! Granted, relatively big losses in MBS are never boring in terms of the damage done to rate sheets, but Fannie 3.5's continue to trade over 103-00! If the big picture is of any consolation to you, that's about a point higher than 2010's best levels. The 103-00 level was also the next logically supportive pivot point after breaking 103-10 at the open.
Bottom line: down, but not out. This week is pretty much over if volume is any indication. Next week's NFP as well as the expiration for Greece's private sector bond swaps will very likely cast the deciding votes in the various battles outlined in the following commentary:
Featured Market Discussion
A recap of the featured comments from the Live Discussion on the MBS Live Dashboard.
Tom Bartlett : "REPRICE: 3:45 PM - Interbank Better"
Ira Selwin : "REPRICE: 3:27 PM - AMC Better"
MC : "REPRICE: 3:25 PM - Provident Funding Better"
Jason Wilborn : "I am not saying I agree with it, but we all know the markets are 75% emotion and sentiment"
Jason Wilborn : "then it has been in the past"
Jason Wilborn : "this is why I say people think the stock market is undervalued - even though DOW and S&P are at breakout levels, because profits have been so robust, the indexes are actually cheaper "
Brent Borcherding : "Oh, I like the self endorsement---I'm considering this a must read!"
Matthew Graham : "It's linked in the news ticker and Live updates window, but if you haven't seen it yet, I think this post is my best of the week in terms of conveying "my take" on the general situation: http://www.mortgagenewsdaily.com/mortgage_rates/blog/249475.aspx"
Brett Boyke : "Goldman revised down their GDP estimates twice today, so they apparently are expecting the party to be crashed"
Andrew Horowitz : "yup, gas prices will be a major headwind IMO"
Brett Boyke : "the wild card is gas prices"
Brent Borcherding : "I'm not joking about the weather, either. It has been phenomenal nationally and that without a doubt is an economic boost."
Matt Hodges : "the fact is in the mid-Atlantic this weather related has been fantastic for buyer contracts"
Andrew Horowitz : "some of it actually is BB...this time"
Brent Borcherding : "I'd say it's all weather related. "
Andrew Horowitz : "the manipulation that went on was in Michigan where dems were out voting for Santorum...now that was funny"
John Paunan : "yeah, any kind of manipulation now would be to influence current voting, i.e., primaries. I guess it's conceivable that it's being done for an insider like Romney, but I don't see how any of this data really helps him..."
Andrew Horowitz : "it is way too early for conspiracy theorists in regards to the data"
Matt Hodges : "suppose there was manipulation.. why would it occur this early? That would only set the incumbent up to keep creating tougher and tougher numbers to beat each month"
Matthew Graham : "great question. let me know if you ever hear a convincing answer. "
Kunal Khanna : "do you really think that during the eelction year data can be manipulated?"
Brett Boyke : "propoganda machine is turned up to notch 11 until the election CK, so that sounds about right"
Chris Kopec : "Boyke....I'm thinking 300+ on NFP next week."
Gaius Rossini : "mortgagee letter slated for today is delayed til next week."