Perfectly Acceptable Conclusion to a Potentially Volatile Week

With markets closed for the Juneteenth holiday on Friday, Thursday marked the end of the trading week. Considering the sell-off on Wednesday afternoon, the week had the potential to end on an uncomfortably volatile note. Instead, bonds pushed back nicely in the other direction–even though MBS didn’t recoup as much of their losses as 10yr Treasuries. True, there is some sense of foreboding in the inability of 10yr yields to move below 4.42%, but all told, the week was actually surprisingly calm after factoring in Thursday’s gains.

Econ Data / Events

Continued Claims (Jun)/06

1,810K vs 1800K f’cast, 1795K prev

Jobless Claims (Jun)/13

226K vs 225K f’cast, 229K prev

Philly Fed Business Index (Jun)

10.3 vs 10 f’cast, -0.4 prev

Philly Fed Prices Paid (Jun)

53.20 vs — f’cast, 47.90 prev

Market Movement Recap

08:55 AM Bonds recover much of post-Fed sell-ff overnight, but mostly in the long end. 2yr yields lost more ground. 10yr yields are down 5bps at 4.446.  MBS are up just under a quarter point.

10:24 AM MBS up 9 ticks (.28) and 10yr down 6.3bps at 4.434

03:02 PM MBS up 5 ticks (.16) and 10yr down 4.2bps at 4.454