Vladimir Putin's Morning Market Call (Not Bad!)
In a news conference overnight from his home in Moscow, Russian President Vladimir Putin unintentionally summed up recent movement in US Treasuries by saying recent market turmoil is a tactical, temporary decision by investors. It would actually be hard to offer a more succinct conclusion on how bond markets treat certain geopolitical events.
When the logical suggestion of such events is in line with something that bond markets might have done anyway, the periodic gluts of movement and volume tend to 'hide behind' newswires relating to said event. The overnight session was no different where a 1am newswire indicating a pullback of Russian military exercises sent Treasury yields sharply higher. The Putin news conference a few hours later made for another smaller bout of weakness for bond markets.
The net effect was a 10yr yield walking in the door near 2.65 (currently 2.64%). That's just over 0.03% higher than yesterday's latest levels. MBS opened right in line with yesterday's weakest levels connoted by Fannie 4.0s down 7 ticks at 104-27. They're currently down 5 ticks at 104-29.
There is no significant data on the calendar today, even though the 9:45am ISM New York index sounds like it should be significant. As such, we'll remain susceptible to Ukraine headlines and compelling moves in other markets.