MBS RECAP: Afternoon Insult Added to Morning Injury

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Posted To: MBS Commentary

Bond markets began the day in weaker territory following overnight weakness in European bond markets. In addition, bond buyers generally got their fill by the end of yesterday morning's snowball rally and then had nowhere to go but back toward higher yields. Put more simply, 10yr yields stalled out at a floor of 2.38+ yesterday and failed to break it again overnight. The domestic session didn't turn ugly until late afternoon when European bonds sold-off into their closing bell. Adding even more pain was the sharp improvement in equities markets. While stocks and bonds haven't necessarily been joined at the hip, both sides were waiting for a bigger move to be made over the past few days. Today's move in stocks is the most compelling attempt so far. There were other potential…(read more)

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