Summertime weekend trading dynamics are sadly a source of motivation for bond markets--especially amid a lack of actionable data on a week that ends with the most actionable data. In that sense, whereas we found ourselves saying "Friday taketh away" at the end of last week, we can now say "Monday giveth." As far as Treasuries were concerned, today's 'givething' more than commensurate with Friday's 'takething.' In other words, yields ended the day at lower levels than Friday morning before the sell-off (and, in fact, lower than most of last week). MBS kept pace with the Treasury gains quite nicely and 2.0 coupons are now at their best levels in 2 weeks.
Fed MBS Buying 10am, 1130am, 1pm
Bonds stronger overnight, mostly in Europe on general 'risk-off' trading. 10yr down 2 bps to 1.504 and 2.0 UMBS up 5 ticks (.16) to 100-24 (100.75).
Additional gains for bonds. No news or events behind the move. Once again, it was the simple fact of the clock striking 9:30am (NYSE Open) that brought a new mix of buyers/sellers into the market--perhaps a few more traders with month-end buying needs.
Friendly Fed speakers keeping levels unchanged near highs for MBS and lows for Treasury yields.
UMBS 2.0 coupons and 10yr yields have nibbled at modest additional gains, but for the most part, have been flat since 10am at noticeably stronger levels.