Tuesday, December 28, 2010

MBS End Day at Session Lows. Treasury Yields Chop Higher

Hot news from AZ Home Help:

Posted To: MBS Commentary

Today was not great for MBS. 4.50 MBS coupons lost nearly a point, going out -25/32 at 101-10. Losses of that magnitude are not common, though you've seen your fair share lately. But when certain factors coincide, the risk of such steep declines grows. Here's a short run down of factors working against bonds today: Low Volume. You'll hear this come up again and again as it exagerates price movements, makes them happen more quickly, and in wider ranges Yesterday saw a "decent" auction lead to good gains. But we weren't sure if the gains were justified by the auction based on the buyer make-up metrics. Today reminded us why. Today's auction was considered as bad as yesterday's auction was considered good Econ data was taken with a "pass/fail" sort of assessment, so even though Case Shiller and...(read more)

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