Modest Losses But Uneventful in The Bigger Picture

'Tis the season for the bond market to enter holiday trading patterns and that fact was on full display today.  Volumes were much lower than the rest of the week and traders made for the exits immediately after European markets closed, squaring positions to avoid risk exposure heading into the notoriously illiquid Thanksgiving work week.  There were two economic reports out at 10am, but neither had an impact.  MBS managed to hold sideways for most of the afternoon with just under a quarter point of weakness on the day (downright small by recent standards).  In the bigger picture, traders wish they could hit the fast forward button to Dec 13/14 (CPI and Fed day).  No one's really sure what to do between now and then.

Econ Data / Events
    • Existing Home Sales
      • 4.43m vs 4.38m f'cast
    • Leading Indicators
      • -0.8 vs -0.4 f'cast, -0.5 prev
Market Movement Recap
08:54 AM

Modestly weaker overnight with 10yr yields hitting 3.825 at the highs.  Some push back since then--now up only 2.4bps at 3.794.  MBS down an eighth of a point

10:45 AM

Weakest levels now with MBS down almost a quarter point and 10yr up 4.3bps at 3.812.

12:20 PM

Additional weakness.  No particular reason.  MBS down roughly 3/8ths.  10yr up 5.6bps at 3.825.

02:09 PM

Off the weakest levels and fairly flat for more than an hour now.  MBS down only 6 ticks (.19) and 10yr yields up 4.8bps at 3.818