After  two weeks of elevated volumes and activity, today hearkened back to old-fashioned Mondays.  Participation was light, market movement was largely an overnight affair, and there was a general absence of interesting info during the domestic session.  While we will add a bit of economic data to the domestic calendar tomorrow, it's now looking like the weather in New York may be keeping financial market participation subdued yet again.

So what are the implications of thinner participation in capital markets?  If today was any indication, not much, but that's not always the case.  Generally speaking, decreased participation usually means that every dollar of trading that manages to occur has more than the average dollar's worth of impact when it comes to moving trading levels.  In other words, the skids are greased for volatility.  Thankfully, the volatility that arises due to light participation tends to favor a trading range as opposed to snowball sell-offs (or rallies, as the case may be).

Miscellaneous thoughts and observations:

- Treasuries continue to underperform European bond markets.  QE is obviously a big culprit, but this week we can at least entertain the possibility that there's some hesitation built into pricing due to the impending auction cycle and FOMC Announcement on Wednesday.  These aren't watershed events in light of last week's ECB news, but they're something.

- From a technical standpoint, that underperformance threatens to reinvigorate the bounce to higher yields that led into last week's ECB Announcement.  I would say that tomorrow would  be informative in that regard, but if participation is as light as it might be due to weather, we probably won't be able to draw any firm conclusions.

MBS Pricing Snapshot
Pricing shown below is delayed, please note the timestamp at the bottom. Real time pricing is available via MBS Live.
FNMA 3.0
102-19 : -0-05
FNMA 3.5
105-02 : -0-04
FNMA 4.0
106-24 : -0-04
2 YR
0.5150 : +0.0250
10 YR
1.8280 : +0.0389
30 YR
2.3980 : +0.0327
Pricing as of 1/26/15 5:09PMEST

Today's Reprice Alerts and Updates
A recap of Alerts and Updates provided to MBS Live subscribers.
2:44PM  :  ALERT ISSUED: Slight Uptick in Negative Reprice Risk
10:48AM  :  ALERT ISSUED: Bonds Markets Move Quickly Testing Support as Stocks Bounce; Negative Reprice Threshold Reached
10:00AM  :  Bond Markets Regaining Footing After Volatile Overnight Session

MBS Live Chat Highlights
A recap of featured comments from the Live Discussion on the MBS Live Dashboard.
Victor Burek  :  "NJ state of emergency"
Matt Hodges  :  "a CT client of mine pushed his closing up to today... i'm sure everyone is taking precautions"
Ira Selwin  :  "We already cancelled any closings for tomorrow for another day."
Ira Selwin  :  "Extensions for closings as well..."
Andy Pada, Jr.  :  "all our fundings through Wednesday have been warehoused"
Ira Selwin  :  "A few investors closing early as well, should be interesting to see what happens tomorrow "
Matthew Graham  :  "East coast folks FYI: "NY Thruway, State Controlled Highways to Close at 10pm""