Bonds began the day in modestly weaker territory although MBS were fairly quick to get back to 'unchanged' while 10yr Treasuries couldn't duplicate that feat until the afternoon. There were no clear correlations with other markets and no notable risks on the econ calendar. The gains were slow and steady enough to suggest an absence of discrete catalysts. That could change on Wednesday with the confluence of ADP and ISM Services--both capable of influencing the bond market, even before the shutdown data dynamics temporarily magnified private data's importance.
Weaker start, but bouncing back a bit now. MBS up 2 ticks (.06) and 10yr yield up 1bp at 4.098
01:13 PM
Best levels of the day with MBS up 3 ticks (.09) and 10yr up only half a bp at 4.092
03:43 PM
Just a bit stronger. MBS up 5 ticks (.16) and 10yr down 0.1bps at 4.087
Lock / Float Considerations
New month/week volatility was one and done on Monday. Tuesday was pleasantly uneventful. That brings us to the portion of the week with consistent economic data releases. Wednesday has the heaviest hitters (ADP/ISM), but there's at least some volatility risk associated with the data through Friday.
