As of the 3pm CME close, 10yr yields were higher on the day. Even though the losses were minimal, they’re not what we’d expect given a 3% loss in stocks and a market that has frequently been trading risk-on/risk-off surrounding various covid/stimulus headlines. There were no salient market movers behind the bond weakness. MBS underperformed at first, but did a better job of holding their ground as Treasuries weakened later in the day (2.0 UMBS are unchanged at the moment).
Market Movement Recap
Markets are in the midst of a “risk-off” move as covid case counts surge worldwide and bonds correct toward lower yields after testing the upper reaches of a longer-term range. 10s are down 2bps to start and UMBS 2.0s are up 2 ticks (0.06). Stocks are down nearly 2% from 5pm yesterday.
As feared (though not necessarily expected), the first 2 days of the week have proven to be a head-fake for bond bulls. Case in point, stocks are down nearly 3% and bonds can’t manage to hold on to modest gains. 10yr yields are up 1bp at .779 and 2.0 UMBS are down 1 tick at 103-06 (-0.03 at 103.19).
MBS Pricing Snapshot
Pricing shown below is delayed, please note the timestamp at the bottom. Real time pricing is available via MBS Live.
103-06 : -0-02
0.7743 : -0.0037
|Pricing as of 10/28/20 5:07PMEST|
Today’s Reprice Alerts and Updates
11:20AM : ALERT ISSUED: Negative Reprice Risk Increasing