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Treasury Consolidation Runs Out of Room, But MBS Keep Gaining
MBS continue to outperform due to favorable supply vs demand. Treasuries continue sideways. In fact, they found a way to express even more uncertainty than the prevailing sideways range of .63-.73 in 10yr yields. Today's trading range? .64-.66. This caps a consolidation trend that will have a hard time getting any narrower. Perhaps bonds are circling the wagons ahead of tonight's presidential debate and prepared for a relatively bigger move tomorrow?
Econ Data / Events
20min of Fed 30yr UMBS Buying 10am, 1130am (M-F) and 1pm (T-Th)
Case Shiller Home Prices (July) +0.6% vs 0.3 f'cast , 0.0 prev
Case Shiller Home Prices (annual) 3.9% vs 3.8 f'cast
Consumer Confidence 101.8 vs 89.5 f'cast 86.3 prev
Market Movement Recap
08:53 AM Modest overnight weakness in stocks and strength in bonds. Treasuries and MBS lost just a bit of ground at the open and are now perfectly unchanged on the day. UMBS 2.0 coupons are at 103-11 (103.34) and 10yr yields are at .6577%.
12:34 PM MBS made small but noticeable gains during and immediately after the 11:30-11:50am Fed buying operation. Sellers brough light supply once again. 2.0 coupons are up an eighth on the day. 10yr yields are also near their lows, down 1.14 bps at .646. Stock market weakness is well-correlated with bond gains so far.
03:45 PM MBS pushing the best levels of the day (103.5) despite Treasuries weakening just slightly this afternoon. Keep crediting the favorable supply/demand environment for MBS outperformance and the stock market for ending the day's Treasury rally. That said, 10yr yields are still more than half a bp lower.
MBS Commentary
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Treasury Consolidation Runs Out of Room, But MBS Keep Gaining
MBS continue to outperform due to favorable supply vs demand. Treasuries continue sideways. In fact, they found a way to ex... (read more)
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Housing News
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The growth of home prices nationally continued to accelerate in July according to the S&P CoreLogic Case-Shiller U.S. National Home Price NSA Index. The National Index, which covers all nine U.S. census divisions, rose 4.8 percent in July on an a... (read more)
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Rob Chrisman
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Here's a brief video refresher of our tax code if anyone needs it. If eight months ago someone had told you to pick a country where there is a mudslinging election for the highest office in the land, the reliability of the post office would be called... (read more)
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Housing News
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Non-conventional lending enjoyed a substantial increase in its share of the market for financing new home purchases in 2019. The National Association of Home Builders (NAHB) says, while conventional loans continued to dominate those purchases, its sh... (read more)
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Mortgage Rate Watch
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Mortgage Rate Update Considering this week's generally positive drift in rates, we shouldn't expect lenders to get less busy any time soon. In recent weeks, there's been a sense that mortgage pricing seems just a little bit "off" compared to expectat... (read more)
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Housing News
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Black Knight said its weekly forbearance survey found the number of mortgages in active forbearance decreasing at an accelerated rate. Those mortgages fell by 2.6 percent or 95,000 loans over the last week, bring the decline over the last month to 35... (read more)
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