MBS RECAP: Bonds Continue Reinforcing The Range Ahead of Fed Week

By: Matthew Graham

Up until this morning's Durable Goods data, bonds looked ready to go either way.  MBS and Treasuries were slightly weaker, somewhere around halfway back to yesterday's weakest levels.  An exceptionally strong showing in the econ data may well have resulted in a test of those weak points.  Instead, the data was fairly poor overall. Cars, Planes, and defense spending buoyed the headline, but by the time those volatile, big-ticket items were factored out, the business spending outlook was not so hot.  In addition, last month's numbers were revised significantly lower.

Bonds rallied as a result.  The trading that occurred overnight, leading up to the report ends up looking like a temporary departure from a 2-day trend that stayed positive for bonds through the noon hour today.  It's not uncommon for the tone in the bond market to change significantly on Friday afternoons, both due to Europe winding down for the day and the approaching weekend affecting participation among domestic traders.

With that in mind, it doesn't make much sense to read into the afternoon trading activity.  What's important is that we're well within April's range heading into Fed week (and the first look at Q1 GDP).  Without any significant data until then, it seems like we'll make it all the way until Wednesday before having a chance at a meaningful break outside the range.


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
102-13 : +0-08
FNMA 3.5
105-07 : +0-07
FNMA 4.0
107-01 : +0-04
Treasuries
2 YR
0.5080 : -0.0240
10 YR
1.9140 : -0.0400
30 YR
2.6140 : -0.0340
Pricing as of 4/24/15 5:32PMEST

Today's Reprice Alerts and Updates
A recap of Alerts and Updates provided to MBS Live subscribers.
9:13AM  :  Durable Goods Components Trump Headline; Bonds Rally

MBS Live Chat Highlights
A recap of featured comments from the Live Discussion on the MBS Live Dashboard.
Brent Borcherding  :  "http://mndne.ws/1asYZn2"
Nathan Stotlar  :  "anyone have the phone # for borrower to get tax transcripts?"
Alan Craft  :  "I'm certainly no expert Jason, but from what I have seen in chat lately it seems retail is killing wholesale on jumbo. They want to go after the assets of those folks."
Jason Berman  :  "Live in a high-cost area & Well Fargo is just crushing the pricing right now. Anyone have any suggestions of Wholesalers that compete on Jumbo pricing?"
Hugh W. Page  :  "The latter"
Ryan Bier  :  "FHA question.... I have a broker who says that his company will allow you to apply for an FHA loan BUT not close for 2 years 1 day after a chapter 7 BK discharge. I thought FHA stated you COULD NOT make application til 2 years 1 day after discharge. Which is correct?"