MBS RECAP: Bond Markets End Week on High Note, but Still in the Range

By: Matthew Graham •

"The Range" can vary depending on whether we're talking about long or short term.  These days, it refers to the a bit of both.  The short term range stretching back to June 3rd has been limited to 10yr yield of 2.57 almost exclusively, on the low end and 2.66 on the high end.  In terms of end-of day levels, that range narrows to 2.60-2.65.  That's pretty narrow for 3 weeks of trading!

Additionally, 2.57 and 2.60--the two ways to look at the lower end of the range--are the same two levels that have served as the lower end of the range for almost all of 2014.  Yields broke lower for only 2 weeks in the second half of May and have since returned, and with a vengeance at that!

Today's trading did absolutely nothing to change that.  There were no significant events and activity was light.  While early session weakness threatened to bring yields to the 2.66 barrier, markets quickly improved and haven't looked back for the rest of the day.  10's are now drifting out just over 2.60 and MBS have fared even better--currently up 6/32nds at 102-12.  Until something new happens, we have no momentum and no trend for now.

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
98-05 : +0-06
FNMA 3.5
102-12 : +0-06
FNMA 4.0
105-23 : +0-08
Treasuries
2 YR
0.4561 : +0.0001
10 YR
2.6098 : -0.0122
30 YR
3.4371 : -0.0239
Pricing as of 6/20/14 5:03PMEST
Today's Reprice Alerts and Updates
A recap of Alerts and Updates provided to MBS Live subscribers.
12:07PM  :  MBS Back Into Positive Territory. Staying Strong vs Treasuries
9:11AM  :  ALERT ISSUED: 10yr Testing 2.66, MBS Outperforming but Still Down on the Day
MBS Live Chat Highlights
A recap of featured comments from the Live Discussion on the MBS Live Dashboard.
Ted Rood  :  "yeah, the 2% for student loans is nice too."
Nathan Miller  :  "thx TR...like the increase from 25% to 50% of total qualifying income for large deposit verifis"
Ted Rood  :  "Some good stuff in the new Freddie bulletin: http://mndne.ws/UUURLC"
Christopher Stevens  :  "And safely back in the range "
Morgan Hammer  :  "You are right MG Flagstar secondary has an itchy trigger finger both ways I guess"
Al Jones  :  "What a tug-a-war :) trend is your friend.. look for better pricing on this downslide.."
Ross Miller  :  "One more complaint, why do we have to provide a homeowners counseling list. My borrower makes $600k per year and I have to give them a list of 10 counseling agencies where they are going to be counseled by someone making $25Kper year on how to manage their money. How dumb is that?"