Technically Stronger But it Feels Weaker

Bonds began the day in stronger territory with overnight support coming most overtly from a surge lower in UK bond yields.  Things changed after the 9:30am NYSE open with some rotation into stocks on strong earnings and the lowest real yields (inflation adjusted) since October 5th.  The end of trading in the EU left an even larger imbalance of sellers vs buyers in US bonds, ultimately pushing 10yr yields back up and over 4%.  MBS gained a quarter point as of 4pm, but had fallen nearly 3/8ths from the intraday highs.

Econ Data / Events
    • NY Fed Manufacturing
      • -9.1 vs -4.0 f'cast, -1.5 prev
      • Prices: 48.6 vs 39.6 prev
Market Movement Recap
08:32 AM

Stronger overnight in a steady, linear move and only moderate volume.  Gains extended slightly at 8:20am CME open.  10yr down 9bps at 3.93% and MBS up half a point.

11:21 AM

Losses at the 9:30am NYSE open with fairly steady weakness since then. MBS still up a quarter point, but down a quarter from the highs.  10yr still down 4.5bps on the day, but up more than 5bps from the lows. 

01:07 PM

Additional weakness heading into the PM hours with 10s briefly cresting 4.0%.  MBS are still up almost a quarter on the day, but down 3/8ths from the highs.

04:25 PM

steady selling all afternoon with 10s barely green at 4.014%.  MBS are outperforming, up a quarter on the day, but down 3/8ths from highs.