MBS RECAP: Bond Markets Play it Safe Ahead of NFP; Mortgages Outperform

By: Matthew Graham •

Last night, Treasuries attempted to play it safe ahead of the European session by rallying sharply on news they figured would have a big positive effect during the overnight session.  They were partly right as Europe did open much stronger, but the weakness was pervasive after that.  It resulted in 10yr yields hitting the domestic open right in line with the levels seen BEFORE yesterday's ECB/Greece news.  In other words, "like it never even happened."

Throughout that process, MBS have played it closer to the vest.  They didn't rally as much yesterday afternoon and they didn't lose as much ground this morning.  On top of that, they improved moderately throughout the day as Treasuries generally went more sideways.  Even though recent history suggests NFP is no longer the massive consideration it once was, it's still worthy of a sideways consolidation heading into it.  That's probably all we're seeing here in terms of today's narrow trading ranges during the domestic hours.

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
102-31 : -0-02
FNMA 3.5
105-15 : +0-02
FNMA 4.0
107-04 : +0-03
Treasuries
2 YR
0.5240 : +0.0400
10 YR
1.8170 : +0.0700
30 YR
2.4290 : +0.0880
Pricing as of 2/5/15 5:56PMEST
Today's Reprice Alerts and Updates
A recap of Alerts and Updates provided to MBS Live subscribers.
10:30AM  :  What's up with the Negative Bond Market Reaction to ECB/Greece News?
MBS Live Chat Highlights
A recap of featured comments from the Live Discussion on the MBS Live Dashboard.
Andy Pada, Jr.  :  "FYI: watch out FHA payoffs, some lenders still charging full month's interest."
Joseph Daquino  :  "They are quick. Just don't do a subordination with TCF right now........"
Ted Rood  :  "Guy in my office said they were actually pretty quick now, like a week."
Clayton Sandy  :  "anyone done a subordination with Wells recently? Just wondering what their turn times are"
JBARRUTIA12  :  "Thanks MG good info"
Matthew Graham  :  "this is a great site, you should check it out: http://mndne.ws/1I0aqbg"
Gilbert Denizard  :  "oil is up 7% today? why isn't 10 year at 2.20?"