Right there in the title of the first commentary of the day: "more economic data that probably won't matter." There's always some small tinge of doubt in my mind before I preemptively dismiss the importance of things that have historically been important. That's probably why I qualified it with the "probably." But now we see that was probably unnecessary. Probably.
Who knows how markets might have reacted if this morning's wage/spending data had been much farther from expectations? Considering that this morning's batch of economic data would certainly have been a market mover at most other moments in market history, the fact that it was completely overlooked says a lot about the current environment.
Some market-watchers out there may even be a bit confused as to why Treasuries and MBS IMPROVED after STRONGER-than-expected Chicago PMI and Consumer Sentiment at 9:45 and 9:55am respectively. Traditional approaches don't really offer a great way to account for that. In today's case, there happened to be headlines and a speech from Britain's Prime Minister concerning a "severe" terrorism alert. UK bond markets led the charge toward lower yields into 10am and everything has leveled off rather uneventfully since then. Net/net, 10yr yields are perfectly unchanged and MBS are up 3 ticks (Fannie 3.5s).
MBS Pricing Snapshot
Pricing shown below is delayed, please note the timestamp at the bottom. Real time pricing
is available via MBS Live.
| MBS || |
99-18 : +0-03
102-31 : +0-02
105-31 : +0-02
| Treasuries || |
0.4880 : -0.0160
2.3380 : +0.0040
3.0740 : +0.0030
| Pricing as of 8/29/14 12:22PMEST |
Morning Reprice Alerts and Updates
9:13AM : Bond Markets Still Not Listening to Econ Data
Live Chat Featured Comments
Matt Hodges : "401k loan, gift to husband"
Aaron Denton : "I hardly ever use Feddie but had a recent deal that would run FAnnie - In a situation where my genius borrower went and blew about $7k on furniture out of his asset reserves prior to closing - Loan now running refer in LP - His wife is not on the loan due to credit issues (birds of a feather) she does however have $12k in a retirement account that would get our reserve levels back in line with our approval. Not being familiar with Freddie guides can anyone give me a pointer in the best way to accomplish this?"
Ted Rood : "Let's hope positive econ data continues to not matter."
Matthew Graham : " THOMSON REUTERS/U. OF MICH US CONSUMER SENTIMENT FINAL AUGUST 82.5 (CONSENSUS 80.1) VS PRELIMINARY AUGUST 79.2 AND FINAL JULY 81.8"
Ted Rood : "A whopping 4 reprices all week per the summary. Secondary Desks must have been very busy in the afternoons,"
Matthew Graham : "RTRS- CHICAGO PURCHASING MANAGEMENT INDEX HIGHEST SINCE MAY"
Matthew Graham : "RTRS- CHICAGO PURCHASING MANAGEMENT INDEX 64.3 IN AUG (CONSENSUS 56.0) VS 52.6 IN JULY"
Victor Burek : "wow...very optimistic in Chicago"
Matt Hodges : "i wouldn't expect much today, AP. it's friday before long holiday weekend"
Andy Pada, Jr. : "seems pretty bond friendly"
Matthew Graham : "RTRS - US JULY PERSONAL INCOME +0.2 PCT, WEAKEST READING SINCE DEC 2013 (CONS +0.3 PCT) VS JUNE +0.5 PCT (PREV +0.4 PCT)"
Matthew Graham : "RTRS- US JULY PERSONAL SPENDING -0.1 PCT (CONSENSUS +0.2 PCT) VS JUNE +0.4 PCT (PREV +0.4 PCT)"
John Tassios : "The PCE will have some bearing MG, that is important for the long end"