Treasuries, MBS Back on Same Page After 2 Weeks On Different Paths

MBS prices were generally losing ground, albeit at a modest pace, over the past two weeks.  That's no big deal in and of itself, but Treasuries were doing the opposite (modest gains over the same 2 weeks). As of today, however, the curse has been reversed. Steady gains in MBS have each 3-month chart looking much more similar to one another.

Econ Data / Events

  • 20min of Fed 30yr UMBS Buying 10am, 1130am (M-F) and 1pm (T-Th)

  • Durable Goods Orders 0.4 vs 1.5 f'cast, 11.4 prev

  • Core Cap-Ex 1.8 vs 0.5 f'cast, 2.5 prev

Market Movement Recap
08:22 AM

Bonds opened slightly stronger as the market moved "risk off" overnight.  S&P futures are down .32% and 10yr yields are down 1.31bps at .654% and 2.0 UMBS are up 3 ticks (0.09) at 103-07 (103.22).

12:13 PM

MBS have inched up steadily and are now at the highs of the day at 103-09 (103.28).  10yr yields improved at a somewhat gentler pace and are currently down 1.31bps at .6544%.  All this despite stocks advancing more than 0.6%.

03:18 PM

Stock surge finally getting bond market's attention with S&P futures up 1.75% and 10yr yields under some pressure.  MBS have outperformed nicely this afternoon with 2.0 UMBS prices now UP more than an eighth on the day even as 10yr yields moved 1bp higher/weaker from intraday lows.