Rather than the gradual decline that many had hoped for, we’re instead seeing a lift-off from the recently flat coronavirus numbers. This has been a driving force for financial markets with stocks sliding and bonds improving.
Market Movement Recap
Bonds improved overnight amid global risk aversion and caution surrounding the second wave of coronavirus cases. 10yr down more than 4bps at .666%. UMBS 2.0 up an eighth in price at 102.19 (102-06).
Stocks and bond yields have been climbing slowly and steadily since 2am. There is no specific news behind the move. 10yr yields are still 2.5bps lower on the day at .684. UMBS 2.0 down .06 at 102.03.
Losses continue, but at a modest pace as the broader market continues moving in a “risk-on” direction after a “risk-off” overnight session. Treasuries still positive on the day, but at the highest yields. MBS are lagging, down almost an eighth and 2.0 coupons trading just under 102.
Additional weakness after the Fed announced the start of its corporate credit facility. Stocks moved higher with 10yr yields and MBS hit new lows, down nearly a quarter point from morning rate sheet print times.
MBS Pricing Snapshot
Pricing shown below is delayed, please note the timestamp at the bottom. Real time pricing is available via MBS Live.
101-31 : -0-03
0.7050 : +0.0060
|Pricing as of 6/15/20 3:32PMEST|
Today’s Reprice Alerts and Updates
2:25PM : Fed Stimulus Update Adds to Bond Weakness/Stock Gains
2:07PM : ALERT ISSUED: Negative Reprice Risk Increasing
10:57AM : ALERT ISSUED: Bonds Slipping; Limited Reprice Risk
8:20AM : Bonds Improve Overnight as Stocks Slump
MBS Live Chat Highlights
Matthew Graham : “No valid guesses, BG, but from a crystal bally, qualitative standpoint, 3 straight days of top tier rates under 3% feels like the kind of thing that might engender some push back in the other direction for a variety of reasons. Realistically though, that assessment is only as good as the broader market movement (i.e. are stocks done panicking?) and coronavirus news cycle/case counts.”