The long-awaited tariff speech took markets for a ride in both directions this afternoon. After the dust settled, the net effect was "buy bonds, sell stocks." Notably, that was a sharp departure from the initial net effect during the early part of Trump's speech. The ultimately friendly result was enough to get Treasuries back into positive territory and for MBS to get sorta close. In the bigger picture, the volatility didn't really matter as both stocks and bonds remained in the same old ranges.
Stronger overnight and no major reaction to ADP data. MBS up an eighth of a point and 10yr down 3.6bps at 4.127
11:50 AM
Losing ground as stocks rally. 10yr up 1.7bps at 4.179 and MBS unchanged.
12:29 PM
More weakness. MBS down an eighth of a point now and 10yr up 4.8 bps at 4.21
04:19 PM
10yr yields are up 6.7bps at 4.23 and MBS are down 6 ticks (.19) on the day and more than a quarter point from rate sheet print times.
Lock / Float Considerations
Econ data and news headlines have managed to cause small scale volatility, but have fallen short of suggesting a departure from the prevailing range. Risk/reward remains muted until that changes. The best bet for a catalyst remains big ticket econ data like Friday's jobs report or next week's CPI.
