MBS Live: MBS MID-DAY
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FNMA 3.5
101-21 : -0-04
FNMA 4.0
103-28 : -0-02
FNMA 4.5
105-17 : -0-02
FNMA 5.0
107-10 : -0-02
GNMA 3.5
103-10 : -0-17
GNMA 4.0
106-10 : -0-16
GNMA 4.5
108-10 : -0-13
GNMA 5.0
109-22 : -0-07
FHLMC 3.5
101-12 : -0-05
FHLMC 4.0
103-20 : -0-05
FHLMC 4.5
105-02 : -0-04
FHLMC 5.0
106-24 : -0-03
Pricing as of 11:04 AM EST
Morning Market Updates
A recap of MBS Market Updates provided by MND Analysts and streamed live to the MBS Live Dashboard.
10:06AM  :  FHFA Responds to Letter from Senators on Executive Compensation
FHFA Acting Director Edward J. DeMarco responded to a letter from numerous U.S. Senators regarding executive compensation at Fannie Mae and Freddie Mac. Read the Letter
8:38AM  :  ECON: Import Prices Down 0.6%, Exports -0.4%
Import prices fell for the third time in five months in October, declining 0.6 percent for the month. The decrease matched a 0.6 percent decline in June, the largest one-month drop since the index fell 1.2 percent in June 2010. The price index for overall imports fell 1.4 percent over the past five months, primarily driven down over that period by declining fuel prices. Despite the recent decreases, import prices advanced 11.0 percent over the past year.

Overall export prices fell 2.1 percent in October, driven lower by falling prices for both nonagricultural and agricultural exports. The October decline followed advances of 0.4 percent and 0.5 percent the two previous months. Despite the October drop, overall export prices increased 6.3 percent over the past year.

8:33AM  :  ECON: Jobless Claims Below the 400k Mark Again.
(Reuters) - New U.S. claims for unemployment benefits declined for the second straight week, to the lowest level since the first week of April, the Labor Department said on Thursday.

Initial claims for state unemployment benefits fell 10,000 to a seasonally adjusted 390,000 in the week ended Nov. 5, slightly below the 400,000 that analysts polled by Reuters had expected. The government revised its estimate for claims during the prior week to 400,000 from 397,000.

Weekly claims still remain well above pre-recession levels and have only dipped below 400,000 -- a threshold many economists believe signifies improving labor market conditions -- 10 times over the past year.

A Labor Department official said a freak fall snowstorm that kept many people housebound in the Northeast did not affect initial jobless claims.

The number of people still receiving benefits under regular state programs after an initial week of aid fell 92,000 in the week ended Oct. 29 to 3.615 million. That was the steepest drop since February, and the lowest level since the week ended Sept. 20, 2008.

The four-week moving average of claims, considered a better measure of labor market trends, fell to 400,000 from 405,250 the prior week, which was revised up from the previously reported 404,500. (Reporting by Lisa Lambert, Editing by Andrea Ricci)
8:28AM  :  ALERT: MBS Stronger Than They Look Factoring Out the Roll
While it's plain to see that broader bond markets are weaker overnight, MBS specifically look weaker than they actually are. The settlement of November Fannie/Freddie 30's took place yesterday and the new "front-month" coupon is a December delivery. That means that yesterday's prices on the chart reflect November coupons while today's reflect December's, which closed at 101-22 last night, meaning that Fannie 3.5's are actually only 1-2 ticks weaker in this morning's trading--not bad!

The other glimmer of hope comes from the distinct double top in 10yr yields overnight at 2.05. Normally we wouldn't read much into technical developments from the nocturnal session, but volume was particularly good, approaching 300k 10yr contracts by 8am NY time vs 100-200 normally. Stock futures are making similar moves but closer to breaking higher past their best levels overnight.

The point about 2.05 in 10yr yields isn't exactly a suggestion that this will hold up as a supportive ceiling as much as it is to point out that it acts as a good line in the sand to let us know if we're at risk of losing more ground. To that end, this AM's economic data, in the form of Jobless Claims and Import/Export prices is coming up in just a few minutes and could serve as the impetus to either help 10's confirm their 2nd bounce lower off 2.05+ or break higher, forcing bond benchmarks to search for that next level of support.
Featured Market Discussion
A recap of the featured comments from the Live Discussion on the MBS Live Dashboard.
Chris Kopec  :  "EU 2012 GDP forecast cut to 0.6% from prior 1.8%"
Andrew Tucker  :  "REPRICE: 10:37 AM - Flagstar Better"
Jeff Anderson  :  "CNBC reporting France's 10 year creeping up and on the radar now. Here we go again."
Brett Boyke  :  "stocks selling off from highs - rumor of France being put on downgrade watch"
Aaron Buyside Meyer  :  ".4% is about right for me as well"
Victor Burek  :  "flagstar took away .4 from yesterday"
Daniel Kramer  :  "Citi has gone back and forth the same 30-35 bps over the last 5 rate sheets"
Matthew Graham  :  "RTRS - U.S. 30-YR FIXED RATE MORTGAGES 3.99 PCT NOV 10 WK VS 4.00 PCT PRIOR WK-FREDDIE MAC "
Matthew Graham  :  "RTRS - WHITE HOUSE'S LEW SAYS THERE ARE REASONS TO BE CAUTIOUS ABOUT SUPER COMMITTEE RESULTS BUT TOO EARLY TO CALL IT FAILURE "
Matthew Graham  :  "RTRS- FEDERAL HOUSING FINANCE AGENCY HEAD SAYS HE WILL TRY TO "MINIMIZE ANY FURTHER TAXPAYER COSTS" ON FANNIE AND FREDDIE, BUT PAY FOR EXECUTIVES ARE "SIMPLY DEFERRED SALARIES" "
Matthew Graham  :  "RTRS- FHFA ACTING DIRECTOR EDWARD DEMARCO SAYS AGENCY USES MARKET COMPENSATION MEASURES TO PAY FANNIE, FREDDIE EXECUTIVES "
Matthew Graham  :  "But I'd add that we often see the 1st day or two after the roll violate previously established technicals only to rise back to meet or exceed them in all cases except persistent sell-off's"
Matthew Graham  :  "inflection point with late October highs right around current levels (101-18"
Oliver S. Orlicki  :  "mg, where should we be looking for support on the 3.5?"
Matthew Graham  :  "RTRS - U.S. EXPORT PRICES DECLINE LARGEST MONTHLY FALL SINCE 2.2 PCT FALL IN DEC 2008 "
Matthew Graham  :  "RTRS - U.S. OCT EXPORT PRICES -2.1 PCT (CONSENSUS +0.3 PCT) VS SEPT +0.4 PCT (PREV +0.4 PCT) "
Matthew Graham  :  "RTRS- U.S. OCT IMPORT PRICES -0.6 PCT (CONS. +0.1 PCT) VS SEPT 0.0 PCT (PREV +0.3 PCT) "
Matthew Graham  :  "RTRS - US JOBLESS CLAIMS LOWEST SINCE WEEK ENDED APRIL 2, 2011; 4-WEEK MOVING AVERAGE LOWEST SINCE WEEK ENDED APRIL 16, 2011 "
Matthew Graham  :  "RTRS- US CONTINUED CLAIMS FELL TO 3.615 MLN (CON. 3.683 MLN) OCT 29 WEEK FROM 3.707 MLN PRIOR WEEK (PREV 3.683 MLN) "
Matthew Graham  :  "RTRS- US JOBLESS CLAIMS 4-WK AVG FELL TO 400,000 NOV 5 WEEK FROM 405,250 PRIOR WEEK (PREVIOUS 404,500) "
Matthew Graham  :  "RTRS - US JOBLESS CLAIMS FELL TO 390,000 NOV 5 WEEK (CONSENSUS 400,000) FROM 400,000 PRIOR WEEK (PREVIOUS 397,000) "
Matthew Graham  :  "RTRS- NEW GREEK CABINET TO BE SWORN IN ON FRIDAY 1200 GMT - PRESIDENCY OFFICIAL "
Matthew Graham  :  "RTRS - NEW GREEK GOVERNMENT MIGHT BE SWORN IN AS EARLY AS 1200 GMT ON FRIDAY- STATE TV "