MBS Easily Outperform Longer-Term Treasuries

Few market watchers would have guessed that MBS would have held almost perfectly sideways since the start of trading on Wednesday this week.  Sure, there’s been just over an eighth of a point of movement in either direction, but prices are ending the day right in line with yesterday morning’s opening levels.  Today’s econ data presented some early headwinds, but they were overcome in short order.  MBS did especially well versus 10yr Treasuries due to the fact that MBS move more like shorter-term Treasuries these days (and shorter-term Treasuries were rallying). 

Econ Data / Events

Jobless Claims

219k vs 230k f’cast, 231k prev

Philly Fed Index

1.7 vs -1.0 f’cast -7.0 prev

Market Movement Recap

08:37 AM MBS are down a quick 2 ticks (.06) and 10yr yields are up 5.1bps at 3.754

12:47 PM Off the weakest levels and sideways.  MBS down only 1 tick (0.03) and 10yr up 4.3bps at 3.745

03:31 PM Slightly better over the past few hours.  MBS up 1 tick (.03).  10yr up 2.3bps at 3.725