MBS MID-DAY: Stronger After Data; Potentially Hitting Resistance

By: Matthew Graham •

Both the 830am and 10am sets of economic data left MBS incrementally better off.  At 830am, it was primarily the big jump in Continued Claims in the Jobless Claims data that prompted the bond market positivity.  At 10am, it was a tepid Philly Fed Index (due to weak internals and only a small improvement in the headline).

The net effect was a rally that almost made it to 3/8ths of a point versus yesterday's latest levels, but has since fallen back to a quarter point gain (in terms of price). 

Bernanke gave his talk at Brookings, but it was more of a broad-scale retrospective for the financial crisis and less to do with impending monetary policy decisions.

Tradeflows in Treasuries are currently quite clear in their suggestion of resistance around 2.84.  While we wouldn't necessarily assume this is an impenetrable floor, it's a good level to watch.  A significant break below would be a positive sign for the trading range.

MBS Pricing Snapshot
Pricing shown below is delayed, please note the timestamp at the bottom. Real time pricing is available via MBS Live.
MBS
FNMA 3.0
95-30 : +0-11
FNMA 3.5
100-11 : +0-10
FNMA 4.0
103-28 : +0-08
Treasuries
2 YR
0.3907 : +0.0007
10 YR
2.8469 : -0.0371
30 YR
3.7814 : -0.0246
Pricing as of 1/16/14 12:21PMEST
Morning Reprice Alerts and Updates
A recap of Alerts and Updates provided to MBS Live subscribers.
10:21AM  :  Bond Markets Stay Strong Following Mixed 10am Econ Data
9:02AM  :  Bond Markets Stronger After First Round of Economic Data
Live Chat Featured Comments
A recap of featured comments from the Live Discussion on the MBS Live Dashboard.
Matthew Graham  :  "RTRS- US JOBLESS CLAIMS FELL TO 326,000 JAN 11 WEEK (CONSENSUS 328,000) FROM 328,000 PRIOR WEEK (PREVIOUS 330,000) "
Matthew Graham  :  "RTRS- US CONTINUED CLAIMS ROSE TO 3.030 MLN JAN 4 WEEK, HIGHEST SINCE WEEK ENDED JULY 6, 2013 (CONS. 2.848 MLN) FROM 2.856 MLN PRIOR WEEK (PREV 2.865 MLN) "
Matthew Graham  :  "RTRS- U.S. DEC CPI YEAR-OVER-YEAR +1.5 PCT (CONS +1.5 PCT), EXFOOD/ENERGY +1.7 PCT (CONS +1.7 PCT) "
Andy Pada, Jr.  :  "the continued claims is a big miss, no?"
hunter16  :  "MG, I really like the way that you have been breaking down in a very concise and to the point way each mornings economic data releases. I also like your take on its perceived importance in the market."
Matthew Graham  :  "RTRS- FED'S WILLIAMS SAYS REMAINS LOTS OF UNCERTAINTY ABOUT HOW QE WORKS ON MARKETS, ECONOMY; A 'BLUNT TOOL' "
Matt Hodges  :  "deed in lieu of FC - anyone know the FHA and Conv guides on refinance?"
Matthew Graham  :  "RTRS- PHILADELPHIA FED BUSINESS CONDITIONS JANUARY 9.4 (CONSENSUS 8.6) VS DEC 6.4 "
Victor Burek  :  "fha is same as purchase, I think, 3 years"
Victor Burek  :  "conventional, if 80 ltv or less, its 2 years"
Victor Burek  :  "4 years if 81 to 90"
Victor Burek  :  "7 if over 90"
Matt Hodges  :  "victor - i'm seeing 4, UNLESS extenuating"
Sam Baugh  :  "Fannie is 2 years 80% LTV"
Sam Baugh  :  "Freddie is 4 years"