MBS Live Recap: Small Scale Volatility Leaves Bonds Slightly Weaker

The day began on a modestly positive note and ended with bonds trading just slightly weaker.  There was little to glean from the price action and no stand-out correlations with news or data.  The only exception was a series of headlines at 5am regarding Moderna booster efficacy with respect to the omicron variant.  After that, 2-way volatility at the 9:30am NYSE open was the most notable event.  When stocks bottomed out and recovered some of their losses in the afternoon, bond yields followed.  

Econ Data / Events
Market Movement Recap
09:16 AM

Moderately stronger in Asia, but gains largely erased in Europe and early US trading.  EU bonds leading the way.  Stocks down more than 1%.  10yr down 1.2 bps and MBS up 2 ticks (0.06). 

01:00 PM

Yields bottomed out just after 11am and have been creeping back up since then.  Less volatility for MBS.  10yr yield still down 0.7bps at 1.40% and MBS up 3 ticks (0.09) at 102-08 (102.25).

02:28 PM

Steadier selling momentum in the past hour with Treasuries turning negative on the day, but just barely.  10yr up half a bp at 1.41.  MBS still positive, but now up only 1 tick (0.03).

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