MBS RECAP: Treasuries Relieved After Auction; Bonds Benefit From European close

By: Matthew Graham

German Bunds dropped to yet another new all-time low today, hitting 0.193 at one point.  The Euro plummeted and stocks sold modestly.  All of the above helped bond markets find their footing heading into the domestic hours.  From there, MBS held fairly steady while Treasuries sold-off gently ahead of the 10yr auction.  10's never came close to moving above overnight highs.

After the mostly strong auction, we saw that 10's instead had their eyes set on moving back to overnight lows (2.096).  They were helped along in that process by the European close as traders exited positions that had been short Treasuries vs long European bonds for the European session.  The Euro currency was breaking a 10yr+ low at the same time, further fueling dollar/Treasury strength.

MBS outperformed in the morning and underperformed after the auction.  That's a pretty logical move considering 10's had more to worry about in the morning and could breathe a bigger sigh of relief after the auction.  The day ended with both MBS and Treasuries in just slightly stronger territory.


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
101-05 : +0-04
FNMA 3.5
104-07 : +0-03
FNMA 4.0
106-14 : -0-01
Treasuries
2 YR
0.6840 : +0.0040
10 YR
2.1090 : -0.0120
30 YR
2.6850 : -0.0230
Pricing as of 3/11/15 5:07PMEST

Today's Reprice Alerts and Updates
A recap of Alerts and Updates provided to MBS Live subscribers.
12:59PM  :  10yr Auction Preview
10:10AM  :  Pulling Back From Overnight Weakness; MBS Erase Losses

MBS Live Chat Highlights
A recap of featured comments from the Live Discussion on the MBS Live Dashboard.
Dustin McAlister  :  "wow, chase bumped jumbos .350 just now"
Jeff Anderson  :  "We started using Encompass on 1/1, JPM. Been OK but have no others to compare to."
John Paul Mulchay  :  "I hear positives on BlitzDoc and Doc Magic..."
Bryce Schetselaar  :  "I like docusign's interface for the customer the best, but the mega downside is that all the signatures have to be manually placed"
John Paul Mulchay  :  "What's the input on best e-sig service for disclosures?"
Matthew Graham  :  "Solid B/B+"
Matthew Graham  :  "RTRS - U.S. 9-YR 11-MO NOTES BID-TO-COVER RATIO 2.65, NON-COMP BIDS $22.25 MLN"
Matthew Graham  :  "RTRS- U.S. SELLS $21 BLN 9-YR 11-MO NOTES AT HIGH YIELD 2.139 PCT, AWARDS 43.25 PCT OF BIDS AT HIGH"