Bond markets have been fairly calm this morning, even if slightly weaker after the ISM Non-Manufacturing data (aka ISM Services).  Before that, there has been little activity as the two overseas hubs of overnight Treasury trading--London and Tokyo--were closed for the day.  The domestic session got off to a slightly positive start and simply moved into slightly negative territory after the ISM data.

Despite the relative lack of movement in MBS and Treasuries, trading levels are in an important zone.  10yr yields are doing battle with the lower end of their 3-month range, marked by 2.60 on average, but with the most aggressive, temporary runs making it down to 2.57.  Notably, that's where they bounced on Friday and again this morning before settling in around 2.61.

Fannie 4.0s are in a similar situation with the analogous level being 105-05.  They're currently off those highs and back down to 105-00.

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
97-27 : -0-04
FNMA 3.5
101-28 : -0-04
FNMA 4.0
105-01 : -0-02
Treasuries
2 YR
0.4225 : -0.0075
10 YR
2.6096 : +0.0166
30 YR
3.4025 : +0.0345
Pricing as of 5/5/14 11:45AMEST
Morning Reprice Alerts and Updates
A recap of Alerts and Updates provided to MBS Live subscribers.
10:04AM  :  ALERT ISSUED: Bond Markets Shoot to Weakest Levels Following ISM; Negative Reprice Risk Increasing
9:09AM  :  Bond Markets Slightly Stronger After Quiet (Nonexistent) Overnight Session
Live Chat Featured Comments
A recap of featured comments from the Live Discussion on the MBS Live Dashboard.
Hugh W. Page  :  "Saw this interesting article yesterday on Bloomberg about bonds. Thoughts? http://mndne.ws/1kC7EYq"
Sung Kim  :  "i thought they stopped being relevant when the treasury retired them during the go go Clinton era"
Hugh W. Page  :  "Article also talked about treasuries dated 10 yrs and longer and I just wondered what implications this has for the 10 Yr. I know pension funds buy more 30 yr but I wonder if any 10 yr buying is also prevalent."
John Tassios  :  "came back under Bush right after 911, I lot of long term pension funds, banks and other large institutions like them for long term income and stability"
Oliver Orlicki  :  "just got an email from AFR introducing a self employed stated loan"
Jon Bodan  :  "just got that AFR email. About choked. But underwritten properly, like they were supposed to be done originally, these are good loans for the right person. I'm stoked."
Matthew Graham  :  "RTRS - ISM REPORT ON U.S. NON-MANUFACTURING SECTOR SHOWS PMI AT 55.2 IN APRIL (CONSENSUS 54.1) VS 53.1 IN MARCH"
Michael Gillani  :  "MG, is the break of 2.60 from Friday into this morning really significant as far as the range is concerned or more of an anomaly that would need confirmation this week?"
Matthew Graham  :  "The interesting thing about it is that it almost perfectly aligned with the lowest 'test' of the range back in February. While 2.60 is the boundary we talk about and the level where we usually start seeing resistance, yields almost never adhere to such levels perfectly. The instances where the boundary has been stretched to the extremes have already seen yields as low as Friday's, so in that sense, yes... still waiting for confirmation, or at least "still tentative" about trusting in the longevity of the rally."