The title sums it up.  Bonds are having a bad time.  Fed rate hike expectations started this unpleasant party last week and economic data added to the drama this week (chiefly, Wednesday's ADP employment data).  

This morning saw fairly modest pressure from the overnight session and the morning's press conference with European Central Bank (ECB) president Mario Draghi.  Long story short: Draghi was a bit more hawkish than expected.  

His hawkishness was reiterated in the afternoon when newswires suggested he'd spoken to EU leaders about the need to get their fiscal houses for the day when the ECB isn't in the stimulus business.

Some combination of that news and several headlines regarding the impending debt ceiling showdown pushed bonds to even weaker levels in the afternoon.  These aren't necessarily the only 2 market-movement considerations, but they were the 2 most overt pieces of news during the mid-afternoon sell-off.  

10yr yields ended the day up 5bps at 2.61.  Fannie 3.5s were down 3/8ths of a point at 101-03.  Keep in mind that tonight was "the roll" for 30yr fixed MBS.  The next coupon in line closed at 100-29 today, temporarily making it look like MBS lost 18 ticks.

MBS Pricing Snapshot
Pricing shown below is delayed, please note the timestamp at the bottom. Real time pricing is available via MBS Live.
FNMA 3.5
100-29 : -0-18
10 YR
2.6090 : +0.0580
Pricing as of 3/9/17 6:33PMEST

Today's Reprice Alerts and Updates
A recap of Alerts and Updates provided to MBS Live subscribers.
2:15PM  :  ALERT ISSUED: Debt Ceiling Drama Potentially Driving Afternoon Volatility
1:57PM  :  ALERT ISSUED: Negative Reprice Risk Increasing as Bonds Hit Weakest Levels
1:07PM  :  30yr Auction Manages Average Stats Despite Concessionary Sell-Off
12:58PM  :  30yr Auction Preview
10:00AM  :  ALERT ISSUED: Negative Reprice Risk Increasing For a Few Lenders
8:57AM  :  ALERT ISSUED: Almost At Negative Reprice Threshold As Draghi Speaks

MBS Live Chat Highlights
A recap of featured comments from the Live Discussion on the MBS Live Dashboard.
Ryan Ford  :  "Thelma better get her wallet out and buys some MBS!"
Peter Lassig II  :  "Haha, love the Thelma and Louise!"
Nathan Miller  :  "that's awesome haha, right up there w/ the MBS dragon"
Bryce Schetselaar  :  "The government shutting down doesn't mean that they stop paying debt. That would be disastrous for a long time in the future"
Timothy Baron  :  "you don't recall the government shutdown?"
Timothy Baron  :  "There's going to be drama."
Bryce Schetselaar  :  "besides, I don't think anyone would put a US credit default on the line for anything"
Bryce Schetselaar  :  "The tune has been that repubs (via Trump) are going to be spending on infrastructure, military, etc. You can't do that without raising the debt ceiling"
Timothy Baron  :  "I don't know BS. Do you think repubs really want to vote for a debt ceiling increase?"
Matthew Graham  :  "I don't think so Bryce, which is one of the reasons I hesitate to assign blame to those wires."
Bryce Schetselaar  :  "MG--why does the market react like this when the full faith and credit of the US isn't going to be compromised? Does it really see even a slight risk of that happening?"
Joe Daquino  :  "Thanks to MBS Live I just got a lock in before we repriced for the that."
Matthew Graham  :  "We're basically working without a net at this point. Only thing to point to would be mid-December highs. Those suggest 2.599 and 2.641 as closing and intraday support respectively."
Ray J  :  "what's the ceiling? 2.62?"
Dan Clifton  :  "MBS lowest since Dec 27"
Matthew Graham  :  "B, give or take. Not bad. Not great"
Matthew Graham  :  "not highly likely, but it could make a dent"
Oliver Orlicki  :  "will the auction even matter?"
John Rodgers  :  "Matt Graham great video on MBS Huddle."