Thinking back to the last NFP report, we had that big beat (288k vs 215k forecast), that ultimately ended in gains for bond markets.  That was pretty intense, and European events were clearly the dark horse.

Thinking back to the NFP before that, we had a reasonable result of 192k vs 206k forecast and a nice revision higher in the previous report.  Not the sort of thing that should have caused a bond market rally, but it did, thanks again--quite clearly--to the day's more meaningful news story about the ECB modelling a QE package.

And now today... the dark horse is back.  Post-ECB party time in Europe gave overseas yields a thorough juicing overnight.  Germany  hit 1.33% for the 3rd time since May 28th.  US Treasuries only reluctantly followed while EU markets outperformed.

After NFP hit, Treasuries first instinct was to head to 2.6, but EU bonds didn't budge.  They didn't sell off at all heading into the data, and they exhibited no knee jerk after the release.  Indeed there was no knee jerk in Treasuries either.  There was simply a domestic market that wanted to sell-off, but was faced with the reality that European bond markets would have none of it.  So we all played Europe's game until they'd bottomed out, and then we began losing the ground that domestic traders wanted us to lose from the outset. 

The icing on this cake came when European markets closed and Treasuries immediately jumped back over 2.59 in 10yr yields.  The timing is too coincidental as you can see in the chart (also shows EU bonds' resolve heading into NFP). 

2014-6-6 us vs de

MBS Pricing Snapshot
Pricing shown below is delayed, please note the timestamp at the bottom. Real time pricing is available via MBS Live.
FNMA 3.0
98-02 : -0-03
FNMA 3.5
102-12 : -0-03
FNMA 4.0
105-20 : -0-01
2 YR
0.4028 : +0.0198
10 YR
2.5968 : +0.0128
30 YR
3.4396 : +0.0076
Pricing as of 6/6/14 4:27PMEST

Today's Reprice Alerts and Updates
A recap of Alerts and Updates provided to MBS Live subscribers.
1:38PM  :  ALERT ISSUED: Negative Reprice Risk Increasing Yet Again; More Serious Now
1:32PM  :  ALERT ISSUED: Reprice Risk Increasing Further
12:15PM  :  ALERT ISSUED: Reprice Risk Increasing; At Another Crossroads
11:04AM  :  ALERT ISSUED: Reprice Risk Looming Once Again
10:11AM  :  Negative Reprice Risk Avoided
9:45AM  :  ALERT ISSUED: Negative Reprice Risk Already? It Depends...
8:41AM  :  ALERT ISSUED: NFP Right on Screws; Bond Markets Slightly Improved

MBS Live Chat Highlights
A recap of featured comments from the Live Discussion on the MBS Live Dashboard.
Sung Kim  :  "bbt allows it rate and term, same 12 month rules"
Clayton Sandy  :  "not sure about recent draws, but I've done non-purchase money 2nds with BB&T as R/T"
Matt Hodges  :  "BBT guides are completely silent.. WF states simply purchase money is fine"
Ted Rood  :  "They don't care whether second has had recent draws?"
Clayton Sandy  :  "BBT will treat any second payoff as R/T"
Matt Hodges  :  "anyone know if BBT jumbo allow R/T for paying off purchase money HELOC?"