Delivered to over
70,000+ industry professionals
each day, the Daily Newsletter is the
definitive recap of the day's most
relevant mortgage and real estate news and data. View the latest Newsletter below.
View our most recent newsletter below, or use the date selector to view past newsletters.
Serious Sell-Off in Bonds. Time to Panic?
A new month brought in new momentum for the bond market--a lot of it--and not the good kind! Treasuries had it far worse than MBS, but MBS are still significantly weaker. Mortgage rates, however, aren't necessarily weaker than yesterday depending on the lender. At first glance, that seems like an obvious lock opportunity. In the short term, that's probably the right idea, but there are other narratives to consider. Those are discussed in today's video, but here's a sneak peek: the traders most interested in buying large amounts of bonds could be the same traders helping push yields higher today.
Econ Data / Events
20min of Fed 30yr UMBS Buying 10am, 1130am (M-F) and 1pm (T-Th)
ISM Manufacturing 57.5 vs 58.0 f'cast, 59.3 prev
Construction Spending 1.3 vs 0.8 f'cast, -0.5 prev
Market Movement Recap
08:52 AM Weaker overnight, following European yield spike at 1am. Strong move in stocks before that, but limited correlation. Bonds recovered a bit by 8am, but have been off to the (selling) races since then. Europe is still leading the charge. New-month trading and corporate bond issuance are hurting. 10yr up 3bps to .872 and MBS are down 6 ticks (.19), but only after rallying a quick 3 ticks in the last hour yesterday (so, it's more like they're only down 0.09).
10:07 AM Snowball selling continues in Treasuries. MBS are vastly outperforming, but unavoidably forced to follow the weakness. Econ data had no impact. Weakness is its own justification at this point. New-month position taking and corporate issuance hedging hedging are the big contributors. 10yr up 6.6bps to .91% and 1.5 UMBS down 3/8ths.
02:04 PM Treasuries tried to level off heading into the noon hour. At the time, MBS were in the midst of a halfway decent recovery, but both have given up on any meaningful bounce back at this point. 10yr yields are up to new highs of .934% and MBS are nearly half a point lower on the day. There are some reports of McConnell getting involved in today's stimulus bill discussions, and that makes bonds take the threat even more seriously.
|
MBS Commentary
|
|
|
Serious Sell-Off in Bonds. Time to Panic?
A new month brought in new momentum for the bond market--a lot of it--and not the good kind! Treasuries had it far worse than MBS, but MBS are still significan... (read more) |
|
|
Housing News
|
|
|
That the rapid rise in home prices since spring is setting near decade long highs was confirmed again this week , this time by CoreLogic. The company says its Home Price Index (HPI) rose 7.3 percent over the 12 months that ended in October and was th... (read more) |
|
|
Housing News
|
|
|
Total construction spending in October was at a seasonally adjusted annual rate of $1.439 trillion according to U.S. Census Bureau estimates. This was an increase of 1.3 percent from the revised September estimate of $1.420 trillion and 3.7 percent h... (read more) |
|
|
Rob Chrisman
|
|
|
In equity news, despite some predictions to the contrary , the market had its best month since 1987. This, in the face of renewed layoffs and economic scaring in the service sector for many lower paying jobs and small businesses. Fixed income…... (read more) |
|
|
Housing News
|
|
|
The Federal Housing Finance Agency (FHFA) has released the new conforming loan limits which will be in place next year for mortgages acquired by the GSEs Fannie Mae and Freddie Mac. In most of the U.S., the 2021 maximum conforming loan limit (CLL) fo... (read more) |
|
|
Mortgage Rate Watch
|
|
|
Although many mortgage lenders were technically open for business last Friday, it's a well-known unofficial holiday. Mortgage rate movement requires bond market movement, and the post-Thanksgiving Friday invariably sees fewer traders trading fewer bo... (read more) |
|
|
|
|
