Today is good one to speak about MBS and Treasuries separately, as they made fairly dissimilar moves. On the Treasury front (which speaks more to the broader trends in interest rates), the day was a flat extension of Friday afternoon's flatness. At the official 3pm close for Treasuries, they were almost perfectly unchanged.
MBS, on the other hand, have been in positive territory most of the day and are at their best levels heading into the 5pm close. Fannie 4.0s gained the most--8/32nds (.25)--and 3.5s added 6/32nds.
Some of this outperformance could be due to a technical push back against underperformance in January. While MBS have been generally strong against historical norms, Treasuries benefited more from the flight-to-safety rally that helped bond markets through the first week in February. Now that stocks have stabilized and emerging markets aren't the drama du jour, some of that 'flight-to-safety' phenomenon is reversing.
By the time we consider relatively light supply of MBS ahead of monthly settlement this week, we have plenty of justification for the home team to be winning this game. Keep in mind that prices for Fannie and Freddie 30yr Fixed MBS will be dropping 8-12 ticks tomorrow due to "the roll."
MBS Pricing Snapshot
Pricing shown below is delayed, please note the timestamp at the bottom. Real time pricing
is available via MBS Live.
| MBS || |
97-09 : +0-04
101-22 : +0-05
105-05 : +0-08
| Treasuries || |
0.3113 : +0.0043
2.6692 : -0.0058
3.6503 : -0.0147
| Pricing as of 2/10/14 4:58PMEST |
Today's Reprice Alerts and Updates
3:27PM : Extremely Quiet Conditions; Narrow Ranges; MBS Little-Changed
9:21AM : Treasuries Weaker, MBS Stronger as Domestic Session Lurches Forward
MBS Live Chat Highlights
Andy Pada, Jr. : "how was everyone's January production numbers?"
Sung Kim : "horrendous"
Joseph Daquino : "I had a pretty good January, not complaining, but could have been better. Looking at having a SOLID February."
Andy Pada, Jr. : "what are the top 3 reasons why lenders are exiting the wholesale business?"
Ira Selwin : "$$, $$, $$"
Matt Hodges : "Compliance"
Ira Selwin : "cost to do business. Compliance, risk, etc..."
Christopher Stevens : "Jeffrey Gundlach thinks 10YR at 2.50 before trend higher continues"
Matthew Graham : "That seems to be one side of the debate right now. It was probably the more prevalent side early last week when the emerging market kool-aid was still going around, and traders were still pretending like they wanted more pain trade, but it started to balance back out by Friday for sure. "