Today's session could as easily not have happened, and it wouldn't change anything about the bigger picture. The same could be true for most any day between now and when data first was placed on hold due the shutdown (with the exception, perhaps, of the necessary day(s) during which the debt deal was negotiated and passed). Volume was exceptionally light for both Treasuries and MBS. Prices were slightly weaker, but uneventfully so. All told, the losses in MBS do more to moderate the relatively brisk gains at the end of last week than they do to suggest any new trend. Now, as then, the onus for more convicted movement rests with economic data. Even without 3 weeks of being pent-up, NFP would still be leading that charge.
MBS Pricing Snapshot
Pricing shown below is delayed, please note the timestamp at the bottom. Real time pricing
is available via MBS Live.
Pricing as of 4:09 PM EST
Afternoon Reprice Alerts and Updates
Below is a recap of instant Reprice Alerts
and updates issued via email and text alert to MBS Live subscribers
Reprice Risk Returns as MBS Hit Lows
Fannie 3.5s have fallen half a tick below the levels that prompted the days first reprice risk notification--currently down 9 ticks at 101-27. The weakness is incidental/tradeflow-related. 10yr yields have risen moderately in the last 10 minutes, up to 2.612 compared to AM highs of 2.616.
Volume remains appallingly light, building an ongoing case for the focus being squarely on tomorrow's NFP release.
Live Chat Featured Comments
Matthew Graham : "particulars are important in those cases though. If it's a mildly positive report that causes a nearly equivocal sell-off, and it comes at the end of a prolonged downtrend in bonds, I might wait it out. "
Bryce Schetselaar : "So that brings up an interesting point. If NFP sets the trend for the next couple weeks, It would be smarter to lock shortly after a bad report comes out rather than get stuck in downward momentum, right?"
Victor Burek : "I locked one earlier closing this month..floating loans closing in more than 15"
Victor Burek : "imo, it could take us much higher than lower...more to risk, very little to gain, unless it is sub 100k, then we rally big"
Ted Rood : "Not like we're seeing a facemelting rally today in anticipation of a horrific report."
Matthew Graham : " here's the thing about lock/float questions before NFP. NFP typically sets the trend for the entire month, and this is doubly true on months where it is significantly better or worse than expected. You can pretty much throw out every movement from before today and just consider tomorrow as a coin toss that will either take rates mostly higher or mostly lower. If the client understands all that and is prepared to lock at a loss if the report is super strong, then power to the client. Otherwise, "
Ted Rood : "See newstream article on employment expectations, float with extreme caution."
Bryce Schetselaar : "lock if it is what the customer wants"
Joe Moran : "lock or float before tomorrow?"
Lynn ONeal : "@ SV - Bruce Upton is at Freedom and really knows his stuff"
Scott Valins : "can I get recommended a good Freedom AE?"
Jon Bodan : "I'd be shocked if ST took that deal, but who else might? I have a client with a similar situation."
lhefner : "BofI likes story loans"
joon choi : "check suntrust"
Sung Kim : "they will touch it when they move it to the shredder"
Scott Valins : "will anyone touch a jumbo deal if borrower short sold an investment property a year ago?"
Matthew Graham : "RTRS- U.S. COMMERCE DEP'T SAYS POSTPONES RELEASE OF FIRST ESTIMATE OF THIRD QUARTER U.S. GDP TO NOV. 7 FROM OCT. 30 "
Ted Rood : "Just ran one, was fine."
Jason York : "me too, credit pulled over fine, but got a general error notice"
Matt Hodges : "i rec'd an error message on my only submission attempt JY"
Jason York : "anyone having issues running DU today?"
Joe Daquino : "Clients are still waiting for rates to go lower.....lol"
Gaius Rossini : "how is the post-debt-ceiling-rally-refi-wave going for everyone?"
Jeff Anderson : "All data was collected prior to the shutdown, wasn't it?"
Victor Burek : "this isn't supposed to be sloppy"
Andy Pada : "won't the marke sort of dismiss this data as "sloppy?" "
Jason Zimmer : "JB - i don't know that it was ever written. just experience that i've seen the 12 months reserves work"
Jon Bodan : "JZ, I think I missed the boat on the DTI expansion for DU, can you point me to the press release or update?"