Stocks and Bond Yields Moving Higher Together; Fed on Deck

Today's trading session turned out to be every bit as simple as it seemed like it would be this morning.  Why so simple?  There were clear indications that improved sentiment in the banking sector was fueling a 'risk-on' trading pattern in Europe (i.e. stock prices and bond yields moving higher together). This extended to US markets, but especially to Treasuries.  MBS actually outperformed, which isn't too shocking considering Treasuries were the star performers when the market was trading in a risk-off direction.

Econ Data / Events
    • Existing Home Sales
      • 4.58m vs 4.20m f'cast, 4.0m prev
Market Movement Recap
08:58 AM

Weaker overnight. Europe trades risk-on.  10yr up 10+ bps at 3.587.  MBS down 3/8ths. 

10:41 AM

Moderate improvement since 9am, but still weaker on the day.  MBS down less than a quarter point.  10yr up 8bps at 3.562.

01:40 PM

Respectable 20yr bond auction without any major reaction in the bond market.  10yr up 10bps at 3.583 and MBS down just over a quarter point.

03:45 PM

Stocks at highs. 10yr yields up 12.3bps at 3.606, near highs.  MBS outperforming despite a brief scare due to illiquidity.  Still down just over a quarter point.

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