Bonds Buyers Back Off as Banks Bounce
Bank health continues to dominate the news cycle with investors buying bonds when things look shaky and selling when days go by without new drama. In addition to the ticking clock, reassuring headlines can also take a toll on bonds. That happened overnight as First Citizens bank assumed over $100 bln in deposits and loans from SVB. A rally in EU equities (led by banks) added to the risk-on sentiment. Domestic hours saw bonds drift sideways to slightly weaker with MBS losing more than 5/8ths and 10yr yields up 16.5bps at 3.535.
- No significant econ data
Weaker overnight, with 10yr yields up 12.8 bps to 3.5 and MBS down half a point.
10yr near weakest levels, up 14bps at 3.511. MBS still down half a point.
Modest additional weakness with MBS down 5/8ths of a point on the day and 10yr yields up 16.2bps at 3.534.