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

08:36 AM

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.

03:01 PM

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.

MBS

UMBS 2.0

103-06 : -0-02

Treasuries

10 YR

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


Economic Calendar

Time Event Period Actual Forecast Prior
Wednesday, Oct 28
7:00 MBA Purchase Index w/e 305.2 304.6
7:00 Mortgage Refinance Index w/e 3711.6 3620.5
13:00 5-Yr Note Auction (bl)* 55
Thursday, Oct 29
8:30 GDP Advance (%)* Q3 31.0 -31.4
8:30 Jobless Claims (k) w/e 775 787
10:00 Pending Sales Index Sep 132.8
13:00 7-Yr Note Auction (bl)* 53

By Matthew Graham , dated 2020-10-28 17:09:14

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Courtesy of Mortgage News Daily

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