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Bonds Eventually Erase All The AM Weakness
Bonds Eventually Erase All The AM Weakness
The sharp overnight losses in stocks and bonds were consistent with a market that didn't have time to process the sort of knee-jerk reaction one would expect from headlines like Moody's US credit rating downgrade. Most of the rest of the domestic session was consistent with the type of reversal one might expect after a knee-jerk reaction to news that wasn't really that newsworthy. As has been exhaustively covered, 2 of the other big 3 ratings agencies had long since taken the US credit rating down a peg, thus limiting the true significance of Friday's news. Bonds ended the day weaker than they were at 3pm last Friday (before the Moody's news), but slightly stronger vs the 5pm levels (15 minutes after the Moody's news).
Sharply weaker overnight as Moody's reaction extends overseas. MBS down 3/8ths and 10yr up 7.3bps at 4.552
Making progress after sellers got their fill. MBS down only an eighth and 10yr up only 2bps at 4.5
Now moving into positive territory with MBS up 1 tick (.03) and 10yr roughly unchanged at 4.481
Moody's Pulls Pin And Walks Away With 10 Minutes Left to Trade
| Time | Event | Period | Actual | Forecast | Prior |
|---|---|---|---|---|---|
| Monday, May 19 | |||||
| 12:00AM | Roll Date - Ginnie Mae 30YR | ||||
| 8:30AM | Fed Bostic Speech | ||||
| 8:45AM | Fed Jefferson Speech | ||||
| 8:45AM | Fed Williams Speech | ||||
| 10:00AM | Apr CB Leading Index MoM (%) | Apr | -1% | -0.9% | -0.7% |
| 1:15PM | Fed Logan Speech | ||||
| 1:30PM | Fed Kashkari Speech | ||||
| Tuesday, May 20 | |||||
| 9:00AM | Fed Bostic Speech | ||||
| 9:00AM | Fed Barkin Speech | ||||
| 9:30AM | Fed Collins Speech | ||||
| 1:00PM | Fed Musalem Speech | ||||
| 5:00PM | Fed Kugler Speech | ||||
| 7:00PM | Fed Daly Speech | ||||
| 7:00PM | Fed Hammack Speech | ||||
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