MBS RECAP: Widespread Reprices as Bonds Start Weak, Finish Strong

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Posted To: MBS Commentary

The bond market was already in the process of holding ground in the overnight session and domestic trading hours only added to the resilience. It may not have seemed overly obvious at first–especially when the day's biggest victory occurred when yields were in the process of holding sideways in WEAKER territory. What's up with big victories coinciding with weaker trading levels? A valid question! Typically , bond market weakness is–well… weak. But timing is everything. Today's weakness came in response to a stronger reading on an important piece of economic data (ISM non-manufacturing). Moreover, the weakness was brief. In fact, in the context of the first few hours of the morning, yields were arguably simply holding sideways at slightly higher levels. Additionally, the post…(read more)

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