• Bonds opened weaker as Yellen's Friday comments reverberated
  • data was largely ignored
  • Bonds rallied after Brexit poll and technical ceiling in 10yr yields

10yr Treasuries have been holding a very tidy, very sideways range for 8 straight days now (that's every single session since the FOMC Minutes, for what it's worth).  During that time, they never moved above 1.89.  Today marked the closest call with that upper boundary as domestic traders joined the bond market sell-off already in progress early this morning.

Not only did the range end up holding, but bonds soon found reason to rally.  While we can assume that some sponsorship came courtesy of the month-end trading environment, the more readily-apparent culprit was a newswire regarding a new poll on the likelihood of Brexit (UK leaving the European Union).  The Fed itself has already said that increased Brexit risks make a June rate hike less likely, and markets weren't shy about responding accordingly.

European bond markets led the way toward lower yields with US markets following.  10yr yields fell fairly quickly from 1.89 to 1.85, and then spent the rest of the day grinding down to lows of 1.83% by the 3pm close.  That's the point at which 'month-end' bond buying would have its fullest effect.  Accordingly, the rally backed-off a bit into the 5pm 'after-hours' close.

MBS did a fairly good job of following the Treasury move, and as usual, were only making smaller version of the movement seen in Treasuries.  MBS managed to make it back to +3 ticks on the day after being -5 ticks at the morning lows, resulting in numerous lender reprices this afternoon.

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
102-12 : +0-03
10 YR
1.8510 : +0.0160
Pricing as of 5/31/16 5:05PMEST

Today's Reprice Alerts and Updates
A recap of Alerts and Updates provided to MBS Live subscribers.
10:55AM  :  What's Up With The Big Reversal?
9:05AM  :  ALERT ISSUED: Weakest Levels in a Month After Data and Corporate Deal Announcements

MBS Live Chat Highlights
A recap of featured comments from the Live Discussion on the MBS Live Dashboard.
Sung Kim  :  "Your understanding is correct"
Ray Blindauer  :  "My understanding is that we are not bound to any tolerance if the actual title company is different than the one actually listed on the disclosures."
Sung Kim  :  "The only time title fees are zero tolerance is if the title company is also on your provide list"
Rich Cordova  :  "If you pick the title company its a 0 tolerance. Anything in section B, services borrower did not shop for is 0 tolerance"
Dustin McAlister  :  "if you pick the title company for a borrower on a refinance does the 10% tolerance rule still apply? i could have swore you had to be on the dot or eat it."