Although MBS did a good job of pushing back against a recent bout of underperformance over the past 3 sessions, today showed it won't be a straight shot. In other words, MBS had closed the gap to Treasuries somewhat since Friday, but it widened again today. This was ultimately only exceptionally noticeable compared to yesterday.
When viewed against the backdrop of the past 5 days, nothing too troubling is going on between Treasuries and MBS, and nothing that can't be explained. Such an explanation would included elevated supply from MBS originators as well as geopolitical risk having a more direct effect on Treasuries.
Both sides of the market started out in stronger territory today thanks to bond-market-friendly comments from the Bank of England--essentially the only market mover of note overnight. At 10am, European bonds bounced at their best levels and domestic equities began improving. Treasuries and MBS followed those moves by embarking on a selling spree that was moderate, but pervasive. By the close, trading levels remained well-within the week's existing range on all accounts.
MBS Pricing Snapshot
Pricing shown below is delayed, please note the timestamp at the bottom. Real time pricing
is available via MBS Live.
| MBS || |
98-19 : -0-05
102-14 : -0-05
105-19 : -0-05
| Treasuries || |
0.4715 : -0.0085
2.4691 : +0.0031
3.2652 : +0.0132
| Pricing as of 7/23/14 5:05PMEST |
Today's Reprice Alerts and Updates
3:12PM : ALERT ISSUED: Selling Accelerates; Negative Reprices a Near Certainty
2:25PM : ALERT ISSUED: Negative Reprice Risk Increasing Again
10:59AM : ALERT ISSUED: Bond Markets Bounce at Range Boundary; Negative Reprice Risk Increasing
9:30AM : Bond Markets Improve Into Domestic Session
MBS Live Chat Highlights
Matthew Graham : "Nothing much Stephen. Looks bigger than it is due to narrowness of MBS range. 10yr chart tells a better story. Volume and participation are light, further greasing the skids for an after-hours move (referring to post-3pm 'pit' close at the CME)."
Stephen Mitroka : "what's with this sell off?"
Ross Miller : "MU, if the borrowers are on title as of original sales date and you can document continuity of Obligation for 12 months and the borrower put down the minimum required investment at the original closing you should be fine as a refi."
Scott Ward : "MU - its been years but yes done as refi with full payment history"
Michael Ullmann : "what will dictate if it should be treated as a purchase or a refi? I was under the impression that 12 months of payments makes it a refi. My u/w feels differently"
Michael Ullmann : "anyone on here have experience with refinancing a loan from a contract for deed?"