MBS MID-DAY: Bond Markets Fighting Back Against Morning Weakness

By: Matthew Graham •

MBS are now at the best levels since before this morning's economic data.  Before that, Treasuries were slightly weaker overnight, resulting in opening levels 2-3 ticks in the red for Fannie 4.0 MBS.  Jobless Claims were lower than expected and Continued Claims fell to the lowest level of the new year.  This prompted a quicker move into weaker territory, resulting a 6/32nds loss by 9:30am.

Bond markets wallowed in that weaker territory until 10am and began bouncing back.  It hasn't been a straight shot by any means (10yr yields actually revisited their highest levels of the day just after the Fed's daily Treasury buying operation ending at 11am), but there is some resilience. 

Interestingly enough, it's right around the 2.74-2.75 zone of yields.  This is quintessentially central/neutral territory in the broader landscape of bond markets since mid 2013.  While it's a bit weaker than shorter term averages, it's not an unreasonable place for rates to be heading into tomorrow's NFP data.

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
96-18 : -0-06
FNMA 3.5
100-28 : -0-05
FNMA 4.0
104-13 : -0-03
Treasuries
2 YR
0.3451 : +0.0121
10 YR
2.7300 : +0.0340
30 YR
3.6742 : +0.0302
Pricing as of 3/6/14 11:57AMEST
Morning Reprice Alerts and Updates
A recap of Alerts and Updates provided to MBS Live subscribers.
8:46AM  :  Bond Markets Weaker After Overnight Session and Morning Data
Live Chat Featured Comments
A recap of featured comments from the Live Discussion on the MBS Live Dashboard.
Victor Burek  :  "i think we move sideways til tomorrow"
Jeff Anderson  :  "We have NFP est at 150k. Is that before ADP? Anyone see revisions lower since then?"
Matthew Graham  :  "RTRS - US JOBLESS CLAIMS FELL TO 323,000 MARCH 1 WEEK, LOWEST SINCE NOV 2013 (CONSENSUS 338,000) FROM 349,000 PRIOR WEEK (PREVIOUS 348,000)"
Christopher Stevens  :  "sideways pushing 2.75"
Victor Burek  :  "after claims, probably hit 2.75 today"
Andy Pada, Jr.  :  "crazy to think that a 323,000 print is the lowest in 3 months."
Steven Koerner  :  "Big shout out to this site. It's saved my you-know-what more than not!"
Hugh W. Page  :  "One of the beauties of this site. Strength in numbers."
Steven Koerner  :  "Back in the correspondent lending game. This site has more value than ever. "
Matt Hodges  :  "any idea how many or who offers 5% FNMA - all gift?"
Ted Rood  :  "OH. Fannie Direct for one."
Sung Kim  :  "Mh - penny Mac for sure"
Jason York  :  "5th 3rd allows all DP to be gifted, also need to check with MI companies, UG allows all gift"