MBS MID-DAY: Pre-Weekend Drift in Full Effect

By: Matthew Graham •

I reserve the right for this "MBS MID-DAY" to also be the "MBS RECAP" as I don't expect much to happen in the rest of the trading day.  It seems fairly clear that bond markets were on a mission to correct from last week's post-NFP rally this week and that this was largely accomplished yesterday.  We've seen some  volatility so far today, but it's increasingly settled down right in line with yesterday's closing levels.

Economic data was light today with only Import/Export Prices and Wholesale Inventories/Sales.  There were no meaningful reactions to either piece of data, although the Wholesale Sales figures at 10am seemed to coincide with bond market strength.  Given the absence of any volume spikes at the time, that move instead has to be chalked up to tradeflows and the stock lever.  Indeed most of the day's meaningful surges in volume have come at seemingly random times of day and in any event, have correlated with analogous movement in equities markets.

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
101-10 : -0-01
FNMA 3.5
104-10 : -0-01
FNMA 4.0
106-21 : -0-01
Treasuries
2 YR
0.6490 : +0.0120
10 YR
2.0990 : -0.0030
30 YR
2.9260 : -0.0100
Pricing as of 10/9/15 2:14PMEST
Morning Reprice Alerts and Updates
A recap of Alerts and Updates provided to MBS Live subscribers.
11:47AM  :  ALERT ISSUED: Some Late-Pricing Lenders Approaching Negative Reprice Risk Threshold
Live Chat Featured Comments
A recap of featured comments from the Live Discussion on the MBS Live Dashboard.
Matt Hodges  :  "the consumer then gets theoretically a worse deal"
Matt Hodges  :  "Jason - you might be missing the point. The Realtor has huge influence on that transaction"
Sung Kim  :  "i agree with you, but in general, it is bad for the consumer. give me an example of where it is good"
Ira Selwin  :  "I'm sure you've been in business long enough to know thats not the case"
Ira Selwin  :  ""But at some point the consumer has to take some responsibility for their choices""
Jason Lowe  :  "Sung, I understand that....but is it the MSA agents job to say you can use whomever you like? Maybe they don't.....I don't know. But at some point the consumer has to take some responsibility for their choices. I guess I just see it as not everything is someone else's fault."
Sung Kim  :  "but this time, they buying oil, stocks and foreign currencies"
Sung Kim  :  "clearly Fed is doing QE4"
Sung Kim  :  "USD at 1.13/EUR, Oil $50+, Stocks broke resistance - all makes perfect sense"
Sung Kim  :  "consumer's always have a choice, but i am pretty sure their MSA agent doesn't really advocate that"
Jason Lowe  :  "MD, I have zero experience with or against MSA's, so take my opinion with a grain of salt. I see absolutely no problem with them as long as the consumer has the choice to shop around. I don't even have a problem with a builder giving a credit of some sort to use a specific lender. Just like everyone involved in the transaction, the builder wants/needs it to close on time so they get their money in a timely fashion. If they KNOW that lender A is going to close it, on time, everytime....then why shouldn't they be able to send business to a person doing their job right? IMO, it's on the consumer to shop around. If they don't do that, then that is their fault. Surely you guys don't have clients that don't understand they can shop around for better rates and/or fees?"