Fun While it Lasted: Bonds Give Up Data-Inspired Gains

Bonds started out weaker early this morning but were able to make gains after weaker economic data at 9:45am and 10:00am.  Prices were almost a quarter of a point higher at their best levels but moved back into negative territory after a weak 2-year Treasury auction (not typically a market mover, but it was today).  

Econ Data / Events
    • Markit Services PMI 44.1 vs 49.2 f'cast, 47.3 prev
    • Markit Manufacturing PMI 51.3 vs 52.0 f'cast, 52.2 prev
    • Composite PMI 45.0 vs 47.7 prev
Market Movement Recap
09:06 AM

Initially flat to stronger, but sellers pounced on the 8:20am CME open.  10yr up 5.2 bps to 3.074.  MBS down more than a quarter point.

09:55 AM

Moderate improvement after weaker PMI data.  10yr up only 1.7bps at 3.039.  MBS down only 2 ticks on the day (-0.06). 

01:35 PM

Nice gains into the noon hour, but selling off since then--especially after the 2yr Treasury auction. MBS down 2 ticks (0.06) at 98-10 (98.31) and 10yr yields up 2bps at 3.044. 

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