MBS RECAP: 3/21/2012
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.
1:32PM :
ALERT:
Low Volatility Rally Continues. Positive Reprice Potential
The small distance between today's periodic highs and lows continues to surprise us into the afternoon. Indeed, today's rally hasn't clocked more than a 4/32nd swing between prominent highs and lows. Fannie 3.5's are grinding against 102-06 at the moment as 10yr yields test a break of 2.30.
After the aformentioned levels, MBS would have their next major pivot at 102-10 to 102-11 and 10's would try to enter the 2.29-2.26 band of yields that marked the battle to contain the sell-off last week. Several lenders have already repriced for the better and simply holding ground at current levels might be enough to entice a few more to poke their heads out of the recent wreckage with a positive reprice--an eventuality that gets more and more likely if we happen to approach the 102-10 pivot area.
After the aformentioned levels, MBS would have their next major pivot at 102-10 to 102-11 and 10's would try to enter the 2.29-2.26 band of yields that marked the battle to contain the sell-off last week. Several lenders have already repriced for the better and simply holding ground at current levels might be enough to entice a few more to poke their heads out of the recent wreckage with a positive reprice--an eventuality that gets more and more likely if we happen to approach the 102-10 pivot area.
11:35AM :
Fed: Failure Is No Longer a (Free) Option for Agency Debt and Mortgage-Backed Securities
A recommended charge on settlement fails for agency debt and agency mortgage-backed securities (MBS) took effect on February 1, 2012. This follows the successful introduction of a charge on settlement fails for U.S. Treasury securities in 2009. With a fails charge, a seller of securities that doesn’t deliver on time must pay a charge to the buyer. The practice is meant to ensure that sellers have adequate incentive to deliver securities without undue delay and thereby reduce the level of settlement fails...
Featured Market Discussion
A recap of the featured comments from the Live Discussion on the MBS Live Dashboard.
Rob Clark : "REPRICE: 3:20 PM - Stearns Lending Better"
Michael Tadros : "REPRICE: 2:47 PM - Flagstar Better"
Jason York : "REPRICE: 2:40 PM - Chase Better"
Jason Nugent : "REPRICE: 2:40 PM - USBank Better"
Jason Nugent : "REPRICE: 2:40 PM - 360 Mortgage Better"
Jeff Anderson : "Chase Rural - Reprice, Better."
Michael Tadros : "REPRICE: 2:36 PM - Suntrust Better"
Victor Burek : "REPRICE: 2:23 PM - Plaza Better"
Steven Stone : "yeah...dont want a whipsaw back tomorrow"
Ira Selwin : "exactly MH"
Matt Hodges : "no, it isn't - a slow steady march downward is a good idea though"
Ira Selwin : "As good as this is for you guys, volatility either way isn't good. "
Edward Bohm : "rally ! rally ! rally !"
Rob Clark : "REPRICE: 2:02 PM - Provident Funding Better"
Matthew Graham : "Still... today is just fantastic so far"
Andrew Russell : "so we won the battle, not the war, huh"
Matthew Graham : "trickling into the high 2.29's in moderate volume PM hours is a victory, but not that big of a deal."
Matthew Graham : "getting under in good volume AM hours would be"
Andrew Russell : "2.29, that big MG?"
Lea Shaw : "REPRICE: 1:40 PM - Nexbank Better"
Lea Shaw : "REPRICE: 1:39 PM - Fifth Third Mortgage Better"
Matthew Graham : "Welcome Jason. Thanks for saying hi!"
Jason Adams : "I wanted to say hello... "first time caller long time listener" I have been on the mortgage news daily site for years and decided it was time to join the majors! "
Eric Franson : "REPRICE: 12:57 PM - Wells Fargo Better"
Edward Bohm : "i smell a big full point rally today!"
Chris Kopec : "I usually switch to CNBC/Bloomberg right after The View is over."
B-C : "OWl you find some great news"
Chris Kopec : "http://www.reuters.com/article/2012/03/21/italy-spain-markets-idUSL5E8EE3WZ20120321"
Chris Kopec : ""The whole Spanish situation has just deteriorated so quickly. We're pretty much looking at Spain as the next point of stress, the next point of weakness," said Peter Allwright, head of absolute rates and currency at RWC Partners, which manages assets worth $4 billion.
If investors keep selling Spanish debt, contagion to the rest of the euro zone risks being more damaging than that triggered recently by Greece and Portugal, economies much smaller than Spain. Italian yields could re-test last ye"
Bert Swyers : "im down for a facemelter"
Dean Gorenflo : "yeah...sign me up!"
Matt Hodges : "amen, brother"
Michael Gillani : "Facemelter rally this afternoon??? Any takers??"
Chris Kopec : "http://www.businessweek.com/news/2012-03-21/spanish-bonds-fall-on-restructuring-concern-german-bunds-gain"
Chris Kopec : "Europe concerns reentering the picture. Italy, Spain, Portugal, yadda yadda."
Derek Nadvornick : "Found out last night Fannie using DURP EA findings soley for high LTV tracking purposes. So we will be pricing EAI-III approvals same as standard Approve/Eligible. Pretty Sweet! And so far we're batting 100% on waivers both LP and DU."