Stocks and bonds haven't necessarily been joined at the hip for every moment of every day recently, but there's been enough correlation to make today's market movement significant.  Simply put, big, obvious breaks to or through new lows in stocks have recently coincided with reliable rallies in bonds.  In today's case, however, bonds hit yesterday's floor multiple times this morning and then bounced higher.

Somewhat troubling was the fact that bond yields continued to move higher even as stocks underwent another clear breakout to more long-term lows.  On most any other day in the past few months, such a move in stocks would have been worth at least a little bit of improvement in rates.  

The takeaway is that the bond market has found its near-term floor of its own volition.  Now, this isn't to say that rates would continue to hold this floor no matter what.  Surely, there's some limit to the amount of stock losses (or other external drama) that rates would be willing to endure before responding.  The issue is that the oncoming holiday season makes for an uncertain, illiquid, and perhaps even inconsequential trading environment.


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 4.0
101-13 : -0-05
Treasuries
10 YR
2.8080 : +0.0320
Pricing as of 12/20/18 5:22PMEST

Today's Reprice Alerts and Updates
A recap of Alerts and Updates provided to MBS Live subscribers.
4:52PM  :  ALERT ISSUED: Negative Reprices More Likely For Some Lenders
3:14PM  :  ALERT ISSUED: Negative Reprice Risk Increasing
11:00AM  :  Still In The Range, But Bonds Looking Shaky

MBS Live Chat Highlights
A recap of featured comments from the Live Discussion on the MBS Live Dashboard.
Matthew Graham  :  "(BN) *DUDLEY SAYS FED NOT THERE TO TAKE AWAY THE MARKET'S PAIN"
Matthew Graham  :  "Santa Pause Spells Doom For 2019"
E S  :  "CS, if the Fed didn’t hike what would be the story today...”Powell concedes to Trump, pauses rate hikes”?"
Matthew Graham  :  "Fed isn't in charge of the stock market"
Chris Stevens  :  "true but isn't the current discussion being held for just that reason...we are not at all time highs?"
Matthew Graham  :  "there would be absolutely no discussion of whether or not the Fed was doing the right thing if stocks were still near all-time highs."

Economic Calendar
Time Event Period Actual Forecast Prior
Thursday, Dec 20
8:30 Philly Fed Business Index * Dec 9.4 15.0 12.9
8:30 Jobless Claims (k) w/e 214 216 206
Friday, Dec 21
8:30 GDP Final (%) Q3 3.5 3.5
8:30 Durable goods (%)* Nov 1.6 -4.3
8:30 Nondefense ex-air (%)* Nov 0.2 0.0
10:00 Personal Income (%)* Nov 0.3 0.5
10:00 Core PCE (m/m) (%)* Nov 0.2 0.1
10:00 Core PCE (y/y) (%)* Nov 1.9 1.8
10:00 U Mich Sentiment Final (ip) Dec 97.5 97.5
10:00 U Mich 1Yr Inf Final (%) Dec 2.7
10:00 U Mich 5-Yr Inf Final (%) Dec 2.4