Complete Silence After AM Volatility
Bonds were mostly flat overnight before a sharp sell-off from 8am through 10am ET. After that, momentum went flat again--especially the last 4 hours of trading. No one is still debating whether or not the AM sell-off was due to Japan's central bank news or a post-holiday return to reality. Yields are back in the pre-Thanksgiving range and ready to respond to this week's bigger-ticket econ reports.
Econ Data / Events
ISM Manufacturing Employment (Nov)
44.0 vs -- f'cast, 46.0 prev
ISM Manufacturing PMI (Nov)
48.2 vs 48.6 f'cast, 48.7 prev
ISM Mfg Prices Paid (Nov)
58.5 vs 59.5 f'cast, 58.0 prev
Market Movement Recap
09:27 AM Mostly flat overnight but selling steadily since 8am. MBS down a quarter point and 10yr up 6.9bps at 4.084
11:09 AM No reaction to ISM data. Holding at weakest levels. MBS down 9 ticks (.28) and 10yr up 7.6bps at 4.09
02:34 PM Steady at weakest levels. MBS still down 9 ticks (.28) and 10yr up 7.9bps at 4.093
MBS Fully Recover After Initial Reaction to Inflation Data
MBS Fully Recover After Initial Reaction to Inflation Data
There’s no question that this morning’s PPI data hit the bond market. The volume spike was easily higher than that seen with yesterday’s CPI and the ma…