• Treasuries flat overnight, despite various cues in other markets
  • Bonds move weaker following ADP data, but damage immediately contained
  • Rest of day spent sideways-to-slightly-stronger, recovering some of the post-ADP weakness
  • MBS down less than an eighth.  10yr yield up less than a bp

Today was largely a maintenance session for bond markets.  It now seems clear that bond markets came out of the gate with heavy conviction yesterday and accomplished most of the more urgent trading goals before today's session.  Specifically, 10yr yields made it very close to 1.84, and then simply held very close to 1.84 today.  After all, a few weeks ago, this is the level that almost anyone would have pointed to as the most likely line of defense against a bigger move toward higher rates.  It's definitely the place you go when you want to be ready for a big move in either direction.

This wasn't quite so obvious yesterday, but today's trading offered some clues.  The biggest clue would be the fact that bonds traded a narrow, slightly stronger range following the stock market opening bell, yet stocks improved during the same time.  Elsewhere, German Bund yields and oil prices also moved higher.  Finally, corporate bond issuance continues to create a meaningful amount of "supply" for markets.  

All of those cues would seem to imply more pressure on bonds than we actually saw.  The conclusion we're left with is that trading levels simply arrived at the stadium a bit early and took their assigned seats.  The game begins over the next 2 days.

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
102-04 : -0-02
10 YR
1.8350 : +0.0000
Pricing as of 3/2/16 5:38PMEST

Today's Reprice Alerts and Updates
A recap of Alerts and Updates provided to MBS Live subscribers.
8:18AM  :  ALERT ISSUED: First Move is Weaker Following ADP Data

MBS Live Chat Highlights
A recap of featured comments from the Live Discussion on the MBS Live Dashboard.
Lenny Ujkic  :  "Starting to happen in DFW area as well. Market is so hot people are offering over asking but not realizing they have to come ot closing most of time with difference"
Dmitry Shamis  :  "I do most of my business in FL as well... Only state where I see such massive misses or where people in advance state how much they will go out of pocket."
Oliver Orlicki  :  "Only Florida loans"
Oliver Orlicki  :  "Me too Hugh"
Hugh W. Page  :  "So you're saying it's a Florida thing"
Jason Anker  :  "everything coming in over HP"
Hugh W. Page  :  "And both over a 10% miss from contract price."
Myles Eastman  :  "We have actually had more favorable than we have had for a while. Thanks for taking the low ones"
Hugh W. Page  :  "It's my month for low appraisals. Two this month so far.....low appraisals worse, same, or better out there in the rest of mortgage land?"