MBS and Treasuries improved at a healthy clip today, and almost exclusively due to the referendum in Greece over the weekend.  The opening yields in overnight Treasury trading were the lowest of the day.  This was followed by steady weakness until 11am and ultimately a nice rally back toward the previous lows to end the day.  MBS did a somewhat acceptable job keeping pace with the flight-to-safety rally, and that's about as much as we can hope for on days like these.

Given the original hype surrounding the Greek referendum (specifically, that it was a vote on remaining in the Eurozone), the fact that German yields didn't break last week's lows is cause for some concern.  After all, if Bund yields won't go any lower than they've already gone despite Greece voting to reject EU-imposed austerity--potentially setting the stage for Greece exiting the Eurozone--what's it gonna take?! 

Not only that, but peripheral European countries are just not as spooked this time around.  To be fair, if we zoomed the following chart in enough, we would indeed see that peripheral states "care" about the Greek situation.  Spreads are elevate relative to early 2014 levels.  The point is that they don't care nearly as much as they did in 2011-2012 when Eurozone systemic risk was in its prime. 

2015-7-6 spreads

There is still a risk that the systemic nightmare comes true (where Greece causes a domino effect that ultimately unravels the Eurozone), but it's not at the top of many lists, unless those are lists of events that are technically possible but highly unlikely.  Still, that technical possibility is worth some caution on the part of global financial markets, and today we saw that caution is worth about 3/8ths of a point in fee on rate sheets.

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
99-24 : +0-17
FNMA 3.5
103-06 : +0-13
FNMA 4.0
106-00 : +0-09
2 YR
0.5930 : -0.0400
10 YR
2.2900 : -0.0959
30 YR
3.0870 : -0.1028
Pricing as of 7/6/15 7:12PMEST

Today's Reprice Alerts and Updates
A recap of Alerts and Updates provided to MBS Live subscribers.
10:18AM  :  ALERT ISSUED: Negative Reprice Risk Already a Consideration
9:58AM  :  Bond Markets Mostly Holding Post-Referendum Gains; Waiting on ISM

MBS Live Chat Highlights
A recap of featured comments from the Live Discussion on the MBS Live Dashboard.
Matthew Graham  :  "the orange and white lines are the big deals in terms of system trouble (Spain and Italy). Note their position relative to the past 6 years."
Matthew Graham  :  "This chart is good to keep in mind though, when it comes to the actual level of contagion risk/fear these days relative to 2011-2012. I added the horizontal lines and some color coding to show some impromptu "risk zones." Check it out."
Joseph Watts  :  "MG any major significance of closing below 2.3 today?"
Matthew Graham  :  "exactly"
Jason Anker  :  "if they can do it then why not me too?"
Matthew Graham  :  "The more that troika components cave in to Greece, the greater the fears of systemic risk"
Matthew Graham  :  "(if I had to guess, I'd just assume it means that the ECB is taking a bigger haircut than it had previously agreed to)"
Matthew Graham  :  "no one has any idea what this actually means"
Matthew Graham  :  "Here's the newswire that started this run at 1:47pm: RTRS- ECB SAYS HAIRCUTS ON COLLATERAL FOR ELA ADJUSTED"
Timothy Baron  :  "Not to generate profit."
Timothy Baron  :  "I understand the origination fee is intended to cover lender fees. Processing, credit report, etc."
Clayton Sandy  :  "charging origination or not wouldn't have anything to do with who is paying the costs. "
Timothy Baron  :  "If the seller pays all the costs, there is no reason to charge an origination fee, correct?"
Jason Anker  :  "Origination rule stands on its own, who pays is not relevant"
Leonard Ujkic  :  "VA QUESTION: If the seller is covering ALL of closing costs on a purchase transaction are you still limited to the 1% Origination Rule for VA?"
Scott Valins  :  ".25 or so JH"
Jason Harris  :  ".375 Jh"
Manny Gomes  :  "same here justin"
Justin Harward  :  "Just curious, what kind of FNMA improvement did you see this morning? Picked up .125% in point improvement over Friday - was expecting a little more"