MBS OPEN: A Few Headlines Down, A Few More To Come

MBS is opening up a few ticks:

4.0's are up 3 ticks at 100-27

4.5's up 2 ticks at 102-31

5.0's up 1 tick at 102-31

- Overnight, treasuries held their gains and the 30yr note continues it's rally, back down now to 2.859%.

- Stock futures are off a bit, perhaps 50ish points in the dow and 8ish in SandP.

- Overseas markets had relatively awful overnight sessions with Asia faring worse than the Euro-Zone, which is getting a late boost from the headline below:

- The ECB cut rates from 2.5 to 2.0, the lowest since 2005

- In other headlines of note, JPM Chase posted a decent beat, earning 7 cents a share whereas most analysts called for a loss.  On a negative note, this is a 76% loss.

Ahead For The Day:

- We'll get PPI shortly and Jobless Claims.  We used to care a lot more about this, and indeed all scheduled data a lot more than we do now.  Yesterday was a good lesson as data was awful, tsy's rallied, dow tanked, and we slid sideways all day long.  If we can't break upward soon, we may well be capped from further gains in MBS, but to a potentially equal extent, insulated from significant losses.  MBS Limbo.  That's neither good or bad as MBS are not currently driving rates to the same extent as lender spreads.  Although this is a temporary dislocation, it should prove frustrating for all in the short term.  To be nimble, we're in the process of building a proprietary index of lender spreads and pricing habits, which will allow all of us adapt to the unique market landscape that should prevail for a for a few months (maybe more, but hopefully not!)