When the range is this narrow, it doesn't take much to move from the lows to the highs. Such is the fate of Fannie 3.0s, which just edged into their best levels of the session at 105-08 after hitting lows roughly 1 hour earlier.

There's been little by way of market-moving news or events to cause the shift, but it does coincide with a broadly connected "risk-off" bounce shared by stocks and Treasuries. S&P's took two stabs at breaking Friday morning's highs and failed on both accounts. 10yr yields shied away from breaking their Friday highs as well. All in all, we're left with the impression that markets have taken the safe route and decided to stay inside Friday ranges in relatively low volume.

Previously growing reprice risk fades from concern at current levels, and "stability" reprices would be more likely. That said, "no reprices" remain the most likely scenario unless MBS add a few more ticks.

Fannie 3.0s just returned to their weakest levels of...

Bond markets continue to trade in their post-NFP ranges, though both MBS and Treasuries are on the stronger end of those ranges. December Fannie 3.0 MBS are up 5 ticks at 105-07 for their farewell performance (MBS ROLL Tonight) and 10yr yields are down about 1.5bps at 1.608.

Italian political uncertainty and Greece's labored efforts to get to the finish line with bailout requirements helped German Bund yields moved down a quick 4 bps at their open, with US Treasuries and stock prices following. Italy's Prime Minister says he will resign after the 2013 budget is passed, which is viewed as a net-negative for Italian austerity measures.

Spain's Economy Minister himself, noted that pressure on Italian bond markets overnight was weighing on Spanish debt as well as the fact that Spain has no plans for additional austerity measures. Yields in both countries rose while Greece extended it's debt buyback offer in order to reach it's €30 bln target required for Thursday's check-signing (currently over €26 bln, so failure isn't likely, but an outside possibility adding to the drama).

There's no relevant economic data this morning and the events later in the week already look to be keeping the trading range compressed in domestic bond markets. Treasuries have continued to hover around 1.61 despite rising stock prices and a full reversal in German Bunds. S&P's are now up a few points from Friday's close.

We're keeping an eye on the 1.613 pivot in 10yr yields from the overnight session. A break higher although not incredibly significant, would be a break of the overnight inflection point and even if it isn't a prelude to a sell-off, could at least reinforce resistance to further improvements. MBS may have already found that resistance with a rejection of a break into Thursday afternoon's lows at 105-07.

When the range is this narrow, it doesn't take much to move from the lows to the highs. Such is the fate of Fannie 3.0s, which just edged into their best levels of the session at 105-08 after hitting lows roughly 1 hour earlier.

There's been little by way of market-moving news or events to cause the shift, but it does coincide with a broadly connected "risk-off" bounce shared by stocks and Treasuries. S&P's took two stabs at breaking Friday morning's highs and failed on both accounts. 10yr yields shied away from breaking their Friday highs as well. All in all, we're left with the impression that markets have taken the safe route and decided to stay inside Friday ranges in relatively low volume.

Previously growing reprice risk fades from concern at current levels, and "stability" reprices would be more likely. That said, "no reprices" remain the most likely scenario unless MBS add a few more ticks.

Fannie 3.0s just returned to their weakest levels of...

Bond markets continue to trade in their post-NFP ranges, though both MBS and Treasuries are on the stronger end of those ranges. December Fannie 3.0 MBS are up 5 ticks at 105-07 for their farewell performance (MBS ROLL Tonight) and 10yr yields are down about 1.5bps at 1.608.

Italian political uncertainty and Greece's labored efforts to get to the finish line with bailout requirements helped German Bund yields moved down a quick 4 bps at their open, with US Treasuries and stock prices following. Italy's Prime Minister says he will resign after the 2013 budget is passed, which is viewed as a net-negative for Italian austerity measures.

Spain's Economy Minister himself, noted that pressure on Italian bond markets overnight was weighing on Spanish debt as well as the fact that Spain has no plans for additional austerity measures. Yields in both countries rose while Greece extended it's debt buyback offer in order to reach it's €30 bln target required for Thursday's check-signing (currently over €26 bln, so failure isn't likely, but an outside possibility adding to the drama).

There's no relevant economic data this morning and the events later in the week already look to be keeping the trading range compressed in domestic bond markets. Treasuries have continued to hover around 1.61 despite rising stock prices and a full reversal in German Bunds. S&P's are now up a few points from Friday's close.

We're keeping an eye on the 1.613 pivot in 10yr yields from the overnight session. A break higher although not incredibly significant, would be a break of the overnight inflection point and even if it isn't a prelude to a sell-off, could at least reinforce resistance to further improvements. MBS may have already found that resistance with a rejection of a break into Thursday afternoon's lows at 105-07.