MBS RECAP: Quiet Grind To Best Ever Levels
By:
Matthew Graham
•
MBS Live: MBS Afternoon Market Summary
Yet again, MBS traded in a remarkably narrow trading range given the all-time high price levels. Treasuries improved as well, though most of the gains were seen overnight after weaker-than-expected economic data out of Germany and various "risk-off" headlines concerning Spanish bailout needs and Greece's "too large for the Troika" budget deficit. Monday's economic data was essentially non-existent with neither of the 3rd tier reports doing anything to move the needle. Instead, the most noticeable movement of the day centered on the cash open for stock markets as well as the scheduled Fed "twist" buying. Volume was appallingly low, but we're expecting that to change as the week progresses.
MBS Pricing Snapshot
Pricing shown below is delayed, please note the timestamp at the bottom. Real time pricing is available via MBS Live.
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Afternoon Reprice Alerts and Updates
Below is a recap of instant Reprice Alerts and updates issued via email and text alert to MBS Live subscribers this afternoon.
12:51PM :
Eerily Quiet Session Continues, MBS Inch A Few Ticks Higher
Welcome to the new normal in MBS trading. Here we are, "breaking" higher into what are technically "new all time highs" in production coupons and it couldn't seem any less exciting. Granted, the lowest rates of all-time are exciting--dream-like even--but the precursor to dreaming is sleeping, and to that end, the underlying market movements are doing their best to put us to sleep.
Fannie 3.0's are up 8 ticks on the day at 105-11, and have hit 105-12 a few times today--the new all time high. We also hit new all-time highs once last week and twice the week before. This pattern of acceleration past previous all-time highs isn't unheard of in terms of daily closing levels, but the less common aspect is that of the utter calmness in intraday price levels. Indeed MBS haven't ticked more than twice in the same direction since 10am.
Treasuries are similarly calm today with 10yr yields essentially between 1.71 and 1.72 since 10am. Volume is extremely low across the board as we've seen on so many data-free Monday mornings.
Fannie 3.0's are up 8 ticks on the day at 105-11, and have hit 105-12 a few times today--the new all time high. We also hit new all-time highs once last week and twice the week before. This pattern of acceleration past previous all-time highs isn't unheard of in terms of daily closing levels, but the less common aspect is that of the utter calmness in intraday price levels. Indeed MBS haven't ticked more than twice in the same direction since 10am.
Treasuries are similarly calm today with 10yr yields essentially between 1.71 and 1.72 since 10am. Volume is extremely low across the board as we've seen on so many data-free Monday mornings.
Live Chat Featured Comments
A recap of the featured comments from the MBS Live Dashboard's Live Chat feature, utilized by hundreds of industry professionals each day.
Matthew Graham : "RTRS- WILLIAMS: WITHOUT RECENT FED ACTION, EMPLOYMENT WOULD MAKE ONLY MODEST GAINS, INFLATION COULD GET STUCK BELOW 2 PCT GOAL "
Matthew Graham : "RTRS- WILLIAMS: RIGHT NOW 6 PCT UNEMPLOYMENT WOULD BE CONSISTENT WITH FED'S FULL EMPLOYMENT GOAL "
Matthew Graham : "RTRS - WILLIAMS: CREDIT CONDITIONS ARE MUCH IMPROVED, HOUSING SECTOR IS SHOWING SIGNS OF LIFE "
Matthew Graham : "RTRS- FED'S WILLIAMS: NO DOUBT U.S. ECONOMY IS 'ON THE MEND' BUT NOT STRONG ENOUGH TO BRING EMPLOYMENT TO NORMAL LEVELS "
Matt Hodges : "3-4 tics"
Matt Hodges : "barely over morning pricing"
Benjamin Payne : "suprised we have not seen more reprices"
Ira Selwin : "Was working before, but it's down again now for me"
Andy Pada : "Ira, you still shut down on Ellie Mae?"
BVG : "They could trade the 1.5 coupon--- won't matter. Too much volume for poorly staffed Lenders as it is."
Matt Hodges : "i still only have one investor pricing 2.5s right now"
Ted Rood : "With MBS prices this high, 2.5% coupon bonds have to start trading later this week, don't they?"
Rob Clark : "REPRICE: 12:15 PM - Provident Funding Better"
Ira Selwin : "http://www.emstatuscenter.com/"
Andy Pada : "closing docs?"
Ira Selwin : "They are working on it"
Ira Selwin : "Yes, known issue"
Andy Pada : "anyone experiencing issues with Ellie Mae?"
Matthew Graham : "fairly vanilla, evenly distributed. No big surprises or suggestions. Slow morning continues."
Matthew Graham : "RTRS- DEALERS SUBMITTED $3.92 BLN OF TREASURIES FOR CONSIDERATION IN FED PURCHASE -NY FED "
Matthew Graham : "RTRS - FED BOUGHT $1.81 BILLION OF TREASURIES MATURING BETWEEN FEB 2036 AND MAY 2042 -NY FED "
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