Small progress since the last post. Yield spreads are tighter as MBS outperforms TSYs. The mysteries of HASP home programs combined with lower yields on the short side of the TSY curve have served to slow "up in coupon" today. Some market participants are moving their bids away from the fuller/riskier side of stack in favor of some prepayment protected positions (ahead of prepayment reports tonight). While MBS prices have cheapened up a few ticks, mortgage bankers are been less willing to offer up new available for bid supply of MBS (pools of loans that you lock!). This has helped to add some stability to production MBS prices. 

FN30_____________________________

FN 4.0 -------->>>> +0-06 to 99-30 from 99-24

FN 4.5 -------->>>> +0-03 to 101-20  from 101-17

FN 5.0 -------->>>> +0-04 to 102-30 from 102-26

FN 5.5 -------->>>> +0-04 to 103-25 from 103-21

FN 6.0 -------->>>> +0-04 to 104-18 from 104-14

GN30________________________________

GN 4.0 -------->>>> +0-03 to 99-30  from 99-27

GN 4.5 -------->>>> +0-02 to 101-24 from 101-22

GN 5.0 -------->>>> +0-04 to 103-15  from 103-11

GN 5.5 -------->>>> +0-03 to 104-01 from 103-30

GN 6.0 -------->>>> +0-03 to 104-19 from 104-16

The FN 4.5 is doing its best to break the 3 day downward trend. Let's cross our fingers for a bottom of 101-13 on the FN 4.5 as any moves below 101-13 should be met with a "buy on cheapness" bid.

Stocks continue to trade lower. The Dow is down 1.55%. The S&P is down 1.84%. The NASDAQ is down 1.51%.