New Yield Highs After Post-Fed Follow-Through and Econ Data

Any time the market goes to sleep on a Fed day in the midst of a big move, there’s a stronger than average possibility that overseas markets will add some momentum in the prevailing direction.  That direction is “UP!” as far as rates and yields are concerned.  The overseas FOMO selling brought yields to new long term highs overnight and a big beat in Jobless Claims made for another few bps of selling.  After that, bonds managed to level off fairly well, but they may have benefited from the acceleration in stock selling.

Econ Data / Events

Jobless Claims

201k vs 225k f’cast, 221k prev

Philly Fed

-13.5 vs -0.7 f’cast, 12 prev

Philly Fed Prices

25.7 vs 20.8 prev

Market Movement Recap

08:34 AM Much weaker overnight with additional selling after data.  10s up 8bps at 4.478.  MBS down almost half a point. 

12:52 PM Calm trading since 9am with MBS down 7 ticks (.22) and 10yr up 7bps at 4.47%.

03:29 PM Some illiquidity weighing on MBS but still generally flat.  6.0 coupons down roughly a quarter point.  10s up 7.9bps at 4.478