MBS Live Recap: Slow Session For Bonds Despite Stock Record

The S&P 500 hit a record intraday high today (just over 2873.22 compared to the previous high of 2872.87).  In other words, it wasn't a triumphant surge.  Moreover, it served as a ceiling, with closing levels being nearly 10 points lower.  Bonds didn't pay too much attention, but they definitely took some directional cues from today's stock movement, which began at the start of the overnight session.

By 8:20am, stocks had dragged bonds into moderately weaker territory.  The CME open provided a bump in liquidity that helped bonds recover a portion of their overnight losses.  But the 9:30am NYSE open took things right back in the other direction, making for the highest yields of the day just after 10am.  

10yr yields ended the day up 2.5bps at 2.844 and Fannie 4.0 MBS lost less than an eighth of a point to end at 101-29 (101.91).  Tomorrow brings the Fed Minutes release at 2pm, although it isn't exactly "hotly-anticipated" this time around.  Still, it's the best chance we have for data-driven market movement.  Apart from that, we're left to watch stocks, headlines, and tradeflows/technicals.