Steady Gains in the PM Hours

It’s common to see the effects of month/quarter-end trading most prominently in the PM hours and today’s quarter-end session was no exception. A glut of bond buying just after 12:30pm got the part started and yields bottomed out just before the 4pm NYSE close.  While 4pm is a time that’s associated with stocks, it has come to be the larger of the two closing bells for the bond market on month/quarter-end days for a variety of reasons (de-emphasis of CME pit over the years, increased prevalence of ETF trading, large portfolio rebalancing that involves both stock/bond ETFs, thus arguing for one unified closing mark time). From here, econ data should take the wheel although it’s always possible to see some new-month positions have an impact on the first day of a new month. 

Econ Data / Events

Chicago PMI

40.4 vs 43.0 f’cast, 40.5 prev

Market Movement Recap

09:12 AM Modestly stronger overnight with gains at the start of EU trading.  MBS up 2 ticks (.06) and 10yr down 1.7bps at 4.264

11:49 AM Very calm still.  MBS up 1 tick (.03) and 10yr down 1.8bps at 4.263

01:28 PM Month-end buying picking up a bit.  10yr down 4.8bps at 4.234.  MBS up an eighth.

04:33 PM Strong month-end move into the close.  MBS up almost a quarter point and 10yr down 4.8bps at 4.233