MBS Day Ahead: Rocky Start For Bonds Ahead of ISM Data


Posted To: MBS Commentary

Bonds had a reasonably rough day yesterday, but most of the weakness was reserved for Treasuries. MBS managed to escape with minimal damage. There were no standout market movers although cases could be made for trade deal optimism and supply concerns (Treasury auctions and corporate issuance). There were also a few stronger economic reports in Europe overnight. Heading into today, bonds have been on the back foot right from the start of Asian trading hours. An upbeat speech from Chinese President Xi set the tone early in the overnight session–at least for stocks. Bond Treasuries are simply in a linear pattern of pain. It's a bit easier to see what I mean with respect to the linear move in Treasuries with them on their own chart. In the bigger picture, this means last week's nice little…(read more)

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