Ceiling Survives But Wednesday is The Test

Any trading day without a big ticket economic report or Fed announcement faces an uphill battle on the road to relevance. Today was no exception with only Housing Starts on the data calendar and a 20yr bond auction rounding out the scheduled events.  The auction was relatively strong and helped facilitate the day's modest gains.  That said, we were already green before the auction and the market seemed to simply be avoiding a break of the 4.32% ceiling.  It's held up quite well now and we can assume Wednesday's Fed events will either precipitate a clear breakout or bounce.

Econ Data / Events
    • Housing Starts
      • 1.521m vs 1.425m f'cast, 1.374m prev
    • Building Permits
      • 1.518m vs 1.495m f'cast, 1.489m prev
Market Movement Recap
09:43 AM

Sideways to slightly stronger overnight.  10yr down 1.6bps at 4.312.  MBS up an eighth.

12:15 PM

10yr down 2bps at 4.308.  MBS still up an eighth.  Sideways and somewhat choppy.

01:17 PM

Some friendly volatility after 20yr bond auction.  10yr briefly down to 4.289, but now back to 4.308 (down 2bps on the day).  MBS up 5 ticks (.16).

02:13 PM

Best levels of the day now with MBS up a quarter point and 10yr down 3.2bps at 4.296