The overnight session was extra quiet for bond markets, with no meaningful movements until after 8am.  In hindsight, uneventful was good as the recently vague pressure on rates kicked into high gear after the FOMC Minutes.  It wasn't so much the Minutes release itself.  In fact, a case could easily be made for the Minutes being positive for bonds.  Rather, it was the stock market reaction combined with the fact that bond markets followed the move.

I won't pretend that today's weakness was ALL about stocks, because clearly, bonds were already in the process of losing ground ahead of the Fed.  Rather, I would say that the abruptness of the knee-jerk trading after the Minutes was primarily a factor of a significant breakout event in equities markets.  Particularly with respect to S&P futures (worlds of street-cred vs the plain old Dow), stocks broke an important ceiling right at the moment bond markets did a 180.  Here's that ceiling in near and medium term context.

2015-10-8 S&P

For what it's worth, that move lower in August was one of only 2 that big since stocks bottomed out in 2009. Bonds don't want to misread cues about a big break lower or a big bounce back toward the previous range, if for no other reason than stocks are bought with money and bonds can be sold for money (which will subsequently be used to buy stocks). Granted, that's a gross oversimplification, but you get the idea. Stock lever in full effect.

2015-10-8 vs


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
101-10 : -0-08
FNMA 3.5
104-10 : -0-05
FNMA 4.0
106-21 : -0-03
Treasuries
2 YR
0.6370 : +0.0080
10 YR
2.1020 : +0.0370
30 YR
2.9360 : +0.0430
Pricing as of 10/8/15 5:39PMEST

Today's Reprice Alerts and Updates
A recap of Alerts and Updates provided to MBS Live subscribers.
3:23PM  :  ALERT ISSUED: Stocks Definitely Taking a Toll (CHART); Reprice Risk is High
2:47PM  :  ALERT ISSUED: Quickly Getting Dicey Again After Post-Fed Knee Jerk
2:06PM  :  First Reaction to FOMC Minutes is Modestly Positive
12:09PM  :  ALERT ISSUED: Another Incremental Increase in Negative Reprice Risk
10:11AM  :  ALERT ISSUED: Lagarde 180 Puts us on Edge of Reprice Risk

MBS Live Chat Highlights
A recap of featured comments from the Live Discussion on the MBS Live Dashboard.
Matthew Graham  :  ""my thought is that markets see the Fed overestimating the rekindling of inflation. If they (the Fed) just said that they would have hiked if not for the disconcerting global outlook, then many market participants believe the Fed won't be able to hike any time soon as the global outlook continues to slide. ""
Andy Pada, Jr.  :  "so where are we?"
Matthew Graham  :  "RTRS- SEVERAL PARTICIPANTS WORRIED THAT INFLATION COULD BE DRAGGED EVEN LOWER BY OIL PRICES AND THE HIGH VALUE OF THE DOLLAR, WHILE A COUPLE EXPRESSED "UNEASE" THAT INFLATION EXPECTATIONS MIGHT ALSO BE DROPPING"
Matthew Graham  :  "RTRS - SOME PARTICIPANTS WARNED THAT A "PREMATURE" RATE HIKE COULD HURT THE FED'S CREDIBILITY IF INFLATION STAYED LOW, WHILE SOME EXPRESSED CONCERNS ABOUT DELAYING A RATE INCREASE"
Matthew Graham  :  "RTRS - POLICYMAKERS EXPRESSED CONCERN OVER THE IMPACT OF GLOBAL CONDITIONS ON U.S., BUT FELT THE EFFECTS ON INFLATION WOULD BE PASSING AND ON GROWTH WOULD BE SMALL"
Matthew Graham  :  "RTRS - MANY PARTICIPANTS AT LAST FOMC MEETING SAW GLOBAL CONDITIONS AS INCREASING DOWNSIDE RISKS TO U.S."
Matthew Graham  :  "RTRS- FED MEMBERS AT LAST MEETING AGREED U.S. ECONOMY REMAINED ON TRACK, BUT DECIDED IT "PRUDENT" TO WAIT FOR MORE INFORMATION BEFORE COMMITTING TO A RATE INCREASE -MINUTES"
Matthew Graham  :  "RTRS - MOST PARTICIPANTS AT SEPT FOMC MEETING FELT CONDITIONS FOR HIKING U.S. RATES HAD ALREADY BEEN MET OR WOULD BE MET BY THE END OF THE YEAR - MINUTES OF SEPT 16-17 FOMC MEETING"