Bonds Remain Rangebound After Morning Weakness

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Today ended up being the most uneventful day of the week in terms of outright volatility.  In other words, bonds didn’t cover as much ground as they did over the past 2 days.  That said, there was still a bit of excitement.

After being unchanged in the overnight session, yields began to rise toward the top of the prevailing range.  Blame a combination of European bond market weakness and domestic stock market strength.  Stronger GDP data didn’t help, but it’s debatable whether or not it hurt.  If bonds were interested in data, they likely wouldn’t have continued selling off after the weaker Pending Home Sales report–especially given the Fed’s mention of the housing market last week.

All it took to turn the ship around was for European markets to close.  After that, the healing began for US bond markets.  MBS and Treasuries both made it back to unchanged territory by the close.  This keeps 10yr yields right in line with the ceiling of the recent range after having bounced off the floor on Monday morning.

MBS Pricing Snapshot

Pricing shown below is delayed, please note the timestamp at the bottom. Real time pricing is available via MBS Live.


FNMA 4.0

101-23 : -0-01


10 YR

2.8858 : +0.0018

Pricing as of 8/29/18 6:07PMEST

Today’s Reprice Alerts and Updates

8:48AM  :  No Major Reaction to Stronger GDP Revision

MBS Live Chat Highlights

Hugh W. Page  :  “or we just continue to grind range bound sideways like we have since basically April.”

Michael Kirsch  :  “thinking the lack of a bounce on the mbs means we are about to blow through support”

Economic Calendar

Time Event Period Actual Forecast Prior
Wednesday, Aug 29
7:00 MBA Purchase Index w/e 230.1 232.1
7:00 Mortgage Refinance Index w/e 952.9 982.7
8:30 GDP Prelim (%)* Q2 +4.2 4.0 4.1
10:00 Pending Sales Index Jul 106.2 106.9
10:00 Pending Home Sales (%) Jul -0.7 0.3 0.9
13:00 7-Yr Note Auction (bl)* 31
Thursday, Aug 30
8:30 Consumer Spending (Consumption) (%) Jul 0.4 0.4
8:30 Personal Income (%)* Jul 0.3 0.4
8:30 Core PCE (y/y) (%)* Jul 2.0 1.9
8:30 Jobless Claims (k) w/e 214 210

Original Source