MBS RECAP: Bonds Refuse to Follow Stocks Lower

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Posted To: MBS Commentary

We've had a pretty good run recently where bond yields have been willing to at least move in the same direction at the same time during sharper stock sell-offs. No luck on that front today however. Stocks sold-off in moderately sharp fashion, and bond yields spent most of that time moving higher instead of lower. This can mean a couple things, but one of the most likely is that bond buyers have found a limit as to how far they're going to chase a stock sell-off unless that sell-off gets a whole lot worse. The less onerous possibility is that this is Thanksgiving week and we shouldn't read too much into typical tradeflow patterns because everything could look completely different in the coming weeks. Finally, for those who would like to maintain a purely positive outlook, I'd…(read more)

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