Bonds Crushed by Data, But Technically Still in The Range

At many points in the past week, we've lamented the narrow, boring nature of the prevailing trading range.  The thesis has been constant: it will take data to prompt a more meaningful move as the market trades on technicals in the meantime.  Today's data did it's best to prompt a meaningful move with GDP revised up 0.6% and Jobless Claims falling most of the way back down to earth.  Bonds reacted with their largest sell-off in several weeks.  Ironically, because the starting point was the bottom of the range, the sell-off was only able to get yields up to the ceiling of the range.  

Econ Data / Events
    • Jobless Claims 
      • 239k vs 265k f'cast, 264k prev
    • Q1 GDP
      • 2.0 vs 1.4 f'cast
    • GDP Final Sales
      • 4.2 vs 3.5 f'cast, 1.1 prev
    • Pending Home Sales
      • -2.7 vs -0.5 f'cast, -0.4 prev
Market Movement Recap
09:07 AM

Weaker overnight with additional selling after econ data.  MBS down 5/8ths and 10yr up 11bps at 3.823.

11:45 AM

Snowball selling into the 10am hour and leveling off after that.  10yr up 13.2bps at 3.846 and MBS down 5/8ths.

02:42 PM

Still sideways at weaker levels, 10yr up 13.6bps at 3.85.  MBS down 3/4ths. 

04:16 PM

Off the weakest levels, but still generally flat.  10yr up 12.4bps at 3.838.  MBS down just under 3/4ths.

 Download our mobile app to get alerts for MBS Commentary and streaming MBS and Treasury prices.