Lots of Apparent Drama For an "Unchanged" Day

The morning's headline proclaimed that today was essentially a "placeholder" due to the week's holiday-shortened schedule and absence of anything incredibly relevant.  In true "placeholder" form, Treasuries and MBS are both unchanged with less than half an hour to trade.  That said, we still managed to perceive enough intraday drama for lenders to send out a few negative reprices.  This was largely a factor of stronger trading levels in the morning giving way to weaker trading levels in the afternoon.  The late day return to 'unchanged' was too little, too late to matter.

Econ Data / Events

  • Fed MBS Buying 10am & 1130am

  • Consumer Sentiment 66.8 vs 72.4 f'cast, 71.7 prev

Market Movement Recap
08:56 AM

Roughly unchanged overnight and slightly stronger so far during domestic hours.  10yr down 1.6bps at 1.554 and MBS up nearly an eighth of a point.

12:39 PM

Gradual weakness since 10am, but not for any particular reason.  10yr now up 1bp at 1.58 and 2.5 UMBS down 1 tick at 102-10 (102.31).  

02:47 PM

MBS at lows of the day with 2.5 coupons down an eighth in total (or a quarter point from today's highs).  10yr yields still up roughly 1bp at 1.58.

04:28 PM

MBS and Treasuries both back to 'unchanged' on the day now, but it's too little, too late for lenders--many of whom repriced for the worse in the past hour.