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MBS RECAP: Bonds Find Footing Early, But Aren't Able to Go Green
Oct 21 2020, 4:25PM

It's safe to say the bond market found its footing today, but that is only a reference to TODAY (not necessarily "finding footing" in the bigger picture). In terms of 10yr yields, overnight highs gave way to slightly lower highs in the morning and another small improvement in the afternoon. None of that was enough for bonds to turn positive on the day, but of the potential "bad days" we could have had, this is one of the better ones.

Econ Data / Events
Market Movement Recap
08:50 AM

Big selling overnight (i.e. higher yields), both out of the gate and in 2 other individual bursts (10:12pm and 12:26am ET).  That brought yields up to .836%, but they've calmed down heading into domestic trading hours--now up only 2.7bps at .813.  MBS are down 3 ticks (-0.09) at 102-30 (102.94).  Stimulus headlines remain in focus, but the most recent example (covered here) didn't leave a big mark.

02:03 PM

Fairly slow and refreshingly resilient after this morning's more troubling weakness.  Stocks surged at the 9:30am NYSE open, but lost ground heading into the EU close.  Bonds paid some small amount of attention, but seem more interested in moving sideways and consolidating the overnight losses.  10yr yp 2bps at .805.  MBS down 2 ticks (0.06) at 103.00.

04:18 PM

MBS prices have been flat since 10:40am without so much as a peep of volatility in 2.0 coupons.  Treasuries have been a bit weaker by comparison and spreads (between MBS and Treasuries) are tighter than they've ever been on any reliable, ongoing basis. 

MBS Pricing Snapshot
Pricing shown below is delayed, please note the timestamp at the bottom. Real time pricing is available via MBS Live.
UMBS 2.0
102-31 : -0-03
10 YR
0.8159 : +0.0189
Pricing as of 10/21/20 4:23PMEST

Today's Reprice Alerts and Updates
A recap of Alerts and Updates provided to MBS Live subscribers.
8:50AM  :  Bonds Much Weaker Overnight But Off The Worst Levels

Economic Calendar
Time Event Period Actual Forecast Prior
Wednesday, Oct 21
7:00 MBA Purchase Index w/e 304.6 311.1
7:00 Mortgage Refinance Index w/e 3620.5 3612.3
Thursday, Oct 22
8:30 Jobless Claims (k) w/e 860 898
10:00 Existing home sales (ml)* Sep 6.30 6.00
10:00 Exist. home sales % chg (%)* Sep 5.0 2.4

About the Author

Chief Operating Officer, Mortgage News Daily / MBS Live
A former originator, Matthew began writing for Mortgage News Daily in 2007, covering a wide range of topics. Seeing a need in the marketplace, his focus increasingly shifted toward relating MBS and broader financial markets for loan originators. ... more

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