Bonds started out sideways and lost a minimal amount of ground very gradually throughout the day. While there were multiple Fed speakers on tap, none of the comments garnered any clear reaction. In terms of timing, the losses only really line up with the start of the 9:30am NYSE open--something that can sometimes create tradeflow dynamics that impact bonds--especially when we're only talking about the sort of modest move seen today.
Slightly weaker after opening flat. UMBS down 3 ticks (.09) and 10yr up 1bp at 4.136
02:46 PM
10yr yields are up almost 2bps at 4.415 and MBS are down 6 ticks (.19) on the day
Lock / Float Considerations
Most clients are lock-biased until the post-Fed selling momentum meets clear resistance. The most risk-tolerant clients are taking heart in the bond market's attempts to find support over the past 2 sessions. This speaks to the possibility that further selling isn't necessarily a given without further justification.
