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Sideways Victory For Bonds and Rates
We've been tracking both a sideways trend and an uptrend in bond yields for more than 2 months now. The uptrend has been winning (and SHOULD win), but bonds were strong enough today to make a case for a return to the sideways range. With rates near all-time lows, "sideways" is a victory.
Econ Data / Events
11:30-11:50 AM (ET) - Fed 30yr UMBS Buying
Philly Fed Biz Survey: +27.5 vs -23.0 f'cast , -43.1 prev
Jobless Claims: 1.508m vs 1.3m f'cast , 1.566m prev
Market Movement Recap
08:48 AM Bonds were stronger out of the gate overnight as stocks slumped. Correlation remains extremely high between the two. After a rebound toward higher yields and stock prices, markets reversed course again just before 5am, moving lower into the domestic session. Stocks have bounced slightly since 8am, but bonds are trying to hold their ground with 10yr yields trading near 0.70% vs a ceiling range of .72-.74. MBS are underperforming, but also in positive territory (nearly an eighth of a point).
12:24 PM Treasuries have been steady as stocks recoup a portion of overnight losses. MBS are near their best levels of the day, up an eighth of a point, still, just under 102 for 2.0 coupons.
02:24 PM VERY slow, sideways day for both MBS and Treasuries (albeit sideways at stronger levels). No major change from the last update.
MBS Commentary
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Sideways Victory For Bonds and Rates
We've been tracking both a sideways trend and an uptrend in bond yields for more than 2 months now. The uptrend has been winning (and SHOULD win), but bonds wer... (read more)
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Housing News
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The dominance of conventional lending continued to grow in May . Ellie Mae's Origination Insight Report says those loans made up 82 percent of originations during the month, up from 81 percent in April and 70 percent at the end of 2019. The FHA share... (read more)
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Housing News
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Freddie Mac's Economic and Housing Research Group says say that, heading into summer, the housing market is rebounding from the COVID-19 pandemic's damage faster than expected. Purchase demand is recovering, and any home price response has, so far, b... (read more)
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Rob Chrisman
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Capital markets folks focus on risk management every day. The public is getting a taste of another kind of risk management when they go to a bar, tattoo parlor, or hair salon. What happens when the government doesn’t specify what masks are acce... (read more)
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Mortgage Rate Watch
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Mortgage rates joined many other sections of financial markets today in doing almost absolutely nothing . Both stocks and bonds were almost perfectly flat. Neither was overly interested in responding to economic data or Round 2 of Fed Chair Powell's ... (read more)
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Housing News
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There has apparently been considerable confusion regarding servicer obligations to report to credit agencies regarding loans in forbearance. The original guidance issued to servicers by the GSEs Fannie Mae and Freddie Mac in mid-March regarding the C... (read more)
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