What a quiet and boring trading session it was! Well, to be fair, there’s still half an hour left as I type this, but most bond market participants mark the end of the day at 3pm E.T. By that time, we were almost perfectly unchanged and hadn’t seen a lick of volatility–quite impressive given yesterday’s volatile “flash rally” move.
Those sorts of big, inexplicable rallies tend to result in rather immediate bounces back toward previous levels. While one COULD make the case for that happening rather halfheartedly, I think the yields are still lower than most would have guessed at 2pm yesterday. In other words, yes, we bounced, but we managed to hold on to a fair amount of yesterday’s gains.
Still, all of that is a bit beside the point as the coming week brings several significant potential market movers. Monday has the lowest potential volatility (at least from a calendar standpoint) as it merely brings 3yr and 10yr Treasury auctions. Risk ramps up starting on Tuesday with the Consumer Price Index data followed by the Fed and ECB on Wednesday and Thursday respectively.
MBS Pricing Snapshot
Pricing shown below is delayed, please note the timestamp at the bottom. Real time pricing is available via MBS Live.
101-19 : -0-05
2.9498 : +0.0168
|Pricing as of 6/8/18 4:56PMEST|
Today’s Reprice Alerts and Updates
3:52PM : ALERT ISSUED: Negative Reprice Risk Increasing
11:01AM : Nothing Happening… Bonds May Be Hitting Snooze Button
MBS Live Chat Highlights
Ted Rood : “when did that “4 quarter/year” thingy start?”
Sung Kim : “if the market truly though we are exceeding 3% annual then ratres would be .50% higher”
Sung Kim : “2nd quarter benefiting from one time cap spending write offs”
Sung Kim : “there are 4 quarters in the year”
Sung Kim : “it’s one quarter”
Ted Rood : “If GDP hits 4.6%, we’ll be longing for 2.92 treasury yields”
Matthew Graham : “could be a good title”
Lawrence Gale CPA : “Beep, Beep!”
Matthew Graham : “what would you like it to cover? Fed outlook? Bernanke’s Wile E. Coyote comments and the implied mega refi boom of 2021?”
Sung Kim : “was trying to save you some time so this week’s marketnewsletter will be mind blowing”
Matthew Graham : “volumes are average or higher.”
John Tassios : “MG, i’m assuming volumes are low today – compared to yesterday’s spike? Also – if you have the CFTC report handy, post for me please. thx”