Markets close at 2pm tomorrow in observance of the Memorial Day Holiday, and will be fully closed on Monday. With that in mind, we've essentially made it through the entire week without anything at all happening! That sounds like an exaggeration, and I suppose it is if you want to be literal about it, but from a market-watching standpoint, we didn't need to know anything about any of the week's events judging by how bonds have moved.
Reason being, Treasury yields have simply been trending higher in yield in a fairly classic consolidation pattern after breaking the 2.57 barrier and hitting 2.473 last week. They (10yr yields) were as high as 2.568 overnight, bringing the consolidation move to a close. If tomorrow takes yields above 2.57 or below 2.52 (which would break the linear consolidation pattern), it wouldn't have the same technical significance as a normal Friday that remained open for a full session and didn't fall before a 3-day weekend.
With that being the case, we'll probably be waiting until Tuesday until we can hope to get clues on how the post-range-break bond market will evolve. A bit of a caveat to the Treasury movement is that MBS have been noticeably outperforming. That doesn't really affect the day-to-day momentum in mortgage rates, but it has helped rate sheets hold their ground over the past few days while Treasuries have weakened.
Today was no exception. Bond markets began leaking after the 10am data (though not necessarily because of it), and MBS were able to retain about half of yesterday's gains while Treasury yields are drifting out at new highs.
MBS Pricing Snapshot
Pricing shown below is delayed, please note the timestamp at the bottom. Real time pricing
is available via MBS Live.
| MBS || |
98-08 : -0-05
102-15 : -0-03
105-18 : -0-01
| Treasuries || |
0.3466 : +0.0076
2.5535 : +0.0175
3.4252 : +0.0092
| Pricing as of 5/22/14 3:48PMEST |
Today's Reprice Alerts and Updates
2:15PM : ALERT ISSUED: New Lows For MBS; Reprices Becoming More Likely
1:10PM : ALERT ISSUED: Negative Reprice Risk Increases Modestly as MBS Follow Treasuries Weaker
11:02AM : MBS Off Highs as Treasuries Test Weakest Levels
10:12AM : MBS in Positive Territory After Tepid Existing Sales Data
8:39AM : Bond Markets Weaker Overnight; Improving Slightly After Jobless Claims Data
MBS Live Chat Highlights
Victor Burek : "market close early tomorrow?"
Jeff Anderson : "2 pm, VB."
Andy Pada, Jr. : "did we find out the supply for next week's auction?"
Matthew Graham : "yes AP"
Matthew Graham : "unchanged in 5's and 7's, 1b lower in 2's"
Scott Lushing : "MG is the 10 year auction today TIPS or is it one we care about?"
Matthew Graham : "TIPS, yes. Usually not a big deal, and even on occasions where it looks like a big deal at first, it usually ends up washing out be end-of-day."
William McGuirt : "max cash out on a non conform jumbo? "
Jason Anker : "up to inv. many answers to that Q Will"
William McGuirt : "if a portion of the cash is used to pay off a heloc does that count towards the total amount?"
Michael Ullmann : "depends if the heloc was tapped into in the last 12 months"
Michael Ullmann : "if no, then paying off a heloc is not considered cash out on non conforming. Additionally on the retail side our max cash out depends on LTV less than 65 ltv its 500k more than 65k its 400k. I would guess your investors have something similar"