MBS MID-DAY: Positive Trend Intact so Far; Minimal Impact From Home Sales Data

By: Matthew Graham •

This morning's Existing Home Sales data was slightly weaker than expected.  The annual pace fell to 5.05 mln from 5.15 mln last month.  Expectations were for an increase to 5.20 mln.  The results were close enough to consensus that we saw no major reaction in bond markets.

MBS and Treasuries were stronger at the open and moved to their weakest levels by 10:15am.  They managed to hold their ground without progressing into negative territory for more than a split second.  From there, the positive 2-day trend has continued.  The mid-morning strength came courtesy of stronger European bond markets and weaker stocks.

10yr yields are currently at 2.556, essentially right in line with our "line in the sand" separating weakness/stagnation from a potential post-FOMC bounce back.  There is no other scheduled data on the day, and trading has been typically slow for a Monday.

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
98-10 : +0-07
FNMA 3.5
102-00 : +0-07
FNMA 4.0
105-06 : +0-04
Treasuries
2 YR
0.5530 : -0.0200
10 YR
2.5580 : -0.0290
30 YR
3.2750 : -0.0250
Pricing as of 9/22/14 12:30PMEST
Morning Reprice Alerts and Updates
A recap of Alerts and Updates provided to MBS Live subscribers.
9:33AM  :  Bond Markets Slightly Stronger Overnight; Holding Gains So Far
Live Chat Featured Comments
A recap of featured comments from the Live Discussion on the MBS Live Dashboard.
Jason Anker  :  "same reason we teach WWII history MD"
Mike Drews  :  "working on CE---can someone please explain why we have to keep learning about pay option ARMs?"
Sam Baugh  :  "If you polled 10 producing realtors in my area they would all say buyers are scarce and inventory is building."
Andy Pada, Jr.  :  "good for us in that the data is friendly. agreed, not good for us as it reflects consumer sentiment regarding housing but I have been bemoaning this fact for over a year."
Matt Hodges  :  "not good for us. We need consumers to buy houses"
John Tassios  :  "We've been noticing this on our end for past few weeks. Purchase loans were down 2nd half of summer months. "
Matthew Graham  :  "RTRS - US AUG EXISTING HOME SALES -1.8 PCT VS JULY +2.2 PCT (PREV +2.4 PCT)-NAR"
Matthew Graham  :  "RTRS- US AUG EXISTING HOME SALES 5.05 MLN UNIT RATE (CONSENSUS 5.20 MLN), VS JULY 5.14 MLN (PREV 5.15 MLN)-NAR"