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Harry Chriest |
Mortgage News Daily

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MBS MID-DAY: MBS Reclaim Ground Lost Since December FOMC
Posted to: MBS Commentary
Tuesday, January 07, 2014 11:54 AM

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On December 18th, Fannie 4.0 MBS were heading into the FOMC's 'tapering' Announcement at 103-12.  They shed nearly 7/8ths of a point by the following morning, hitting 102-18.  The first bounce back from those lows ended up setting the range for the next three weeks.  That range remained capped by 103-09 until this morning when 4.0s once again traded at pre-FOMC levels of 103-12.

There are a few major caveats to what sounds like a pretty positive scenario.  First of all, the roll is coming up in two days, meaning prices are more appropriately seen as roughly 10 ticks lower.  Then there's the matter of spreads being extra tight vs Treasuries, not leaving much room for improvement or 'value buying.'  On a final note, Treasuries themselves are not nearly faring so well compared to FOMC levels with 10yr yields currently at 2.947 compared to the very highest pre-FOMC highs in the 2.91 range.

This morning's gains have been moderate.  10's are only down 1.5bps and MBS only up 5 ticks.  The trade data did nothing to move the needle and the upcoming 3yr auction at 1pm is the least interesting of the 3 we'll see this week.


MBS Pricing Snapshot
Pricing shown below is delayed, please note the timestamp at the bottom. Real time pricing is available via MBS Live.
MBS
FNMA 3.0
95-12 : +0-04
FNMA 3.5
99-26 : +0-04
FNMA 4.0
103-12 : +0-05
Treasuries
2 YR
0.3969 : +-0.0001
10 YR
2.9484 : -0.0126
30 YR
3.8903 : -0.0067
Pricing as of 1/7/14 11:54AMEST

Morning Reprice Alerts and Updates
A recap of Alerts and Updates provided to MBS Live subscribers.
8:58AM  :  Trade Gap a Non-Event; Bond Markets Stay Close to Unchanged

Live Chat Featured Comments
A recap of featured comments from the Live Discussion on the MBS Live Dashboard.
Matthew Graham  :  "RTRS- US NOV TRADE DEFICIT $34.25 BLN, LOWEST SINCE OCT 2009 (CONSENSUS $40.0 BLN), VS OCT DEFICIT $39.33 BLN (PREV $40.64 BLN) "
Matthew Graham  :  "RTRS- US NOV GOODS DEFICIT $53.94 BLN, LOWEST SINCE NOV 2010; SERVICES SURPLUS $19.69 BLN "
Scott Valins  :  "gm all...light trading due to weather to start day? "
Matthew Graham  :  "volume was pretty average up until data and it's been dead since then"
Matthew Graham  :  "RTRS- U.S. FED'S ROSENGREN: STIMULUS SHOULD BE REMOVED ONLY GRADUALLY AS ECONOMY CONTINUES TO IMPROVE "
Steven Koerner  :  "Does anyone know a bank that will do 90% financing on a single family Jumbo loan amount $800? "
Sam Baugh  :  "Alliant will."
Sam Baugh  :  "I prefer to do a 80/10 alliant 1st without the LPMI hits and a TCF 2nd. Payment is really attractive."




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More From MND

Mortgage Rates:
  • 30 Yr FRM 3.99%
  • |
  • 15 Yr FRM 3.16%
  • |
  • Jumbo 30 Year Fixed 3.91%
MBS Prices:
  • 30YR FNMA 4.5 108-11 (0-04)
  • |
  • 30YR FNMA 5.0 110-22 (0-03)
  • |
  • 30YR FNMA 5.5 111-22 (0-02)
Recent Housing Data:
  • Mortgage Apps 11.56%
  • |
  • Refinance Index 23.29%
  • |
  • FHFA Home Price Index 0.67%