Drifty Day, Treasuries Hold Weekly Gains, MBS Underperform.

With a strong move last Friday, the bond market was able to end the week at slightly stronger levels than those seen at the end of the previous week.  This is more readily seen on the Treasury side of the market where yields were under 1.26% at the 3pm CME close versus roughly 1.30 on Friday afternoon.  MBS underperformed, ultimately returning to 'unchanged' levels in the 4pm hour even as Treasuries remined slightly stronger on the day.

Econ Data / Events

  • Fed MBS Buying 10am, 1130am, 1pm

  • NY Fed Manufacturing 18.3 vs 29.0 f'cast, 43.0 prev

Market Movement Recap
08:54 AM

Slightly stronger overnight on weakness in Asia.  Slight rebound toward weaker levels in Europe, but 10yr still down on the day (-1.6bps) at 1.267%.  MBS are up 2 ticks  or 0.06.

09:49 AM

Additional gains after the 9:30am NYSE open.  10yr down 5.3bps to 1.23% and MBS up almost a quarter point.  S&P is down half a percent on the day.

11:53 AM

Off the best levels now.  10yr back up to 1.248 after hitting 1.223% earlier.  MBS down an eighth of a point from AM highs.

03:57 PM

10yr is another bp higher and MBS are 2 ticks lower from the last update (-.19 from the intraday highs).  Trading has slowed to a trickle.  Nothing notable driving the weakness--just a general drift after AM highs.