Treasury yields broke one important ceiling yesterday (.74%) and another today at .79% before finding support at .823%.  This leaves them at the highest levels since late March and in danger of moving higher.  Mortgage rates have been outperforming, but they’re not immune from the risks.

Econ Data / Events

  • 11:30-11:50 AM (ET) – Fed 30yr UMBS Buying  

  • Jobless Claims 1.877m vs 1.800m f’cast

  • Continued Claims 21.487m vs 20.838m previous

Market Movement Recap

08:07 AM

Only modestly weaker overnight with no major reaction to the first phase of the European Central Bank announcement.  The press conference is yet to come.  Treasury yields continue holding under yesterday’s highs.  MBS are opening roughly unchanged, but haven’t found liquidity yet.  10yr yields are up 1.5bps at .761.

08:59 AM

Shortly after the last update (which discussed ‘unchanged’ bond markets), Treasuries quickly jumped 1bp in 10yr yields with little apparent provocation.  Lagarde is speaking, yes, but there was no equivalent move in European bonds.

09:52 AM

Bonds deteriorating rapidly.  Technical ceilings taken out in Treasuries (10yr up 7.2bps to 0.818%).  MBS outperforming, but a quarter point weaker nonetheless.  No new market mover behind this.  Bond traders came to sell today and were just waiting to see if the ECB gave them a reason to do anything else.

12:50 PM

Things look to have stabilized for now in the bond market.  10yr yields holding near 0.81% (+6.5bps on the day).  MBS significantly outperforming with 2.0 UMBS 30yr coupons down just over an eighth of a point on the day.  Stocks are off highs and now back to dometic session lows (which wseems to be helping).

MBS Pricing Snapshot

Pricing shown below is delayed, please note the timestamp at the bottom. Real time pricing is available via MBS Live.


UMBS 2.0

101-18 : -0-04


10 YR

0.8180 : +0.0570

Pricing as of 6/4/20 4:13PMEST

Today’s Reprice Alerts and Updates

3:11PM  :  MBS Holding Up Pretty Well Despite Ongoing Treasury Slide

9:51AM  :  ALERT ISSUED: More Reprice Risk; Things Are Getting Serious

9:13AM  :  ALERT ISSUED: Quick Reversal; Bonds Losing Ground

8:57AM  :  Jobless Claims Can’t Pull Off The Repeat; Lagarde Uneventful

By Matthew Graham , dated 2020-06-04 16:15:56

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Courtesy of Mortgage News Daily

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