The most interesting news overnight was the reaffirmation from Greek leaders that the country is done with austerity, no matter the cost.  At this point, European trading levels are suggesting two things that didn't used to go together: a Greek Eurozone exit AND not much resulting drama. 

In terms of technical support 1.953 was a key level for 10yr yields on Friday.  Before the 3pm official close in Treasuries, yields never went higher.  The analogous level for Fannie 3.0 MBS would be 102-08.   After an disappointingly shallow overnight rally, 10yr yields are back within striking distance of that technical support (1.941) and Fannie 3.0s are a mere tick above their line in the sand (102-09).

A relatively stronger move for bond markets in Europe failed to translate to material gains in US markets.  Additionally, big corporate bond issuance (Microsoft, in particular) and the upcoming auctions are creating supply pressures.  Corporate debt not only acts as an alternative to other bond market investments, but also often uses short positions (read: higher rates) in Treasuries to hedge against interest rate changes during the issuance process.


MBS Pricing Snapshot
Pricing shown below is delayed, please note the timestamp at the bottom. Real time pricing is available via MBS Live.
MBS
FNMA 3.0
102-10 : +0-06
FNMA 3.5
105-05 : +0-06
FNMA 4.0
107-01 : +0-04
Treasuries
2 YR
0.6480 : +0.0005
10 YR
1.9390 : -0.0194
30 YR
2.5030 : -0.0278
Pricing as of 2/9/15 12:55PMEST

Morning Reprice Alerts and Updates
A recap of Alerts and Updates provided to MBS Live subscribers.
10:27AM  :  Bond Markets Remain Tentative After Friday's Sell-Off

Live Chat Featured Comments
A recap of featured comments from the Live Discussion on the MBS Live Dashboard.
Jason Harris  :  "Any sudden movement in Italy, Spain, Portugal....will have to be driven by political pressure. Greece's success or lack thereof may well dictate whether we see that. Not as if the other peripheral nations are much better off"
Matthew Graham  :  "With Italian credit spreads at the tightest levels since 2011, it doesn't even look like they're considering moving on a dime."
Matthew Graham  :  "no I don't JA"
Jeff Anderson  :  "Think there just taking a wait and see approach this time?"
Matthew Graham  :  ".6-ish at 3.625 c30"
Michael Ullmann  :  "what was the average hit from Thursdays last rate sheet to Friday? I was seeing about 50-75 bps based on product"
Matthew Graham  :  "peripheral markets continue to not really care. No major change in the credit spread chart. The only conclusion I'm really left with is that the Eurozone doesn't care this time"
Jeff Anderson  :  "So are the markets starting to think that a Geek exit is a good thing? MG's day ahead has me a bit spooked. I know there's a long way to go here, but the reaction so far. More limited than I thought it'd be this am, and the Day ahead got me thinking. Which always isn't a good thing."
Hugh W. Page  :  "Glad we're better today. Love it when you talk to a client about better pricing on Thursday, market tanks on Friday, and they go under contract on Saturday."