Bond markets capped a rather unpleasant 2-day move today.  While 10yr yields only rose 3.4bps by the close, the losses put us right back in the 1.52-1.62 range that dominated the 2 weeks leading up to last week's Fed Announcement.  Following the Fed, rates moved lower with apparent conviction, but that now looks like a head fake.  

The timing of the weakness is important, considering that tomorrow kicks off 3 busy days of important economic data (ADP and ISM Services in the morning, and of course, NFP on Friday).  There's some small chance that we're simply seeing extra defensiveness on the part of traders due to a heavy week of corporate bond issuance.  But even then, we'd likely need to see weaker economic data tomorrow if we hope to continue the fight to break back below the important range boundary at 1.52%.

Today's top tier data was limited to Incomes and Outlays, which did little to move markets this morning (income was slightly lower than expected and spending was slightly higher).  Much bigger market movement was seen heading into the afternoon as traders who'd bet against bonds covered their short positions ("short" = sell bonds, so "short-covering" = buy bonds).  This has the effect of pushing yields lower, but without an underlying positive implication.  Disconcertingly, yields bounced HARD at 1.52% before heading higher into the close (disconcerting in that it confirms this will be a tough level to break through).


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
103-22 : -0-04
Treasuries
10 YR
1.5540 : +0.0570
Pricing as of 8/2/16 5:23PMEST

Today's Reprice Alerts and Updates
A recap of Alerts and Updates provided to MBS Live subscribers.
4:31PM  :  ALERT ISSUED: Negative Reprice Risk Ticking Up Modestly
3:50PM  :  ALERT ISSUED: Back to Lows; Only 1 or 2 Lenders Might Reprice
11:22AM  :  Bonds Bounce Back on Stock Slide; Temporary or Just The Beginning?
9:31AM  :  Relentless Japanese/European/Corporate Pounding Continues

MBS Live Chat Highlights
A recap of featured comments from the Live Discussion on the MBS Live Dashboard.
Blake Carrillo  :  "...no matter how small."
Jason Anker  :  "a condo is a condo"
Dustin McAlister  :  "anyone aware of a VA rule regarding stand alone detached condos that wouldn't need prior VA approval?"
Curt Sandfort  :  "they should be enhancing PIW, not eliminating it"
Dustin McAlister  :  "Freddie is eliminating PIA as of Oct 1."
JEREMEY BECK  :  "i got a PIW just last week from FNMA"
Dustin McAlister  :  "anyone hear of fnma getting rid of the PIW option?"