Posted To: MBS Commentary
Today was the 4th day of the year that stocks closed higher than they opened. In other, far from coincidental news, it was also the 4th day of the year that 10yr yields closed higher than they opened. That's really all there is to it--at least until the dramatic downtrend in stocks is officially over. Until then, these periodic bounces will continue to result in bonds bracing for bigger impacts. In other words, if stocks were to continue significantly higher tomorrow, bonds would rather be in position for it, instead of playing catch-up. The 4bps increase in 10yr yields is a mere token in the bigger picture, but it gets bonds a small cautionary head start without being onerous or difficult to reverse. We'd need to see serious strength in stocks before we see a serious bond bond market...(read more) Forward this article via email: Send a copy of this story to someone you know that may want to read it.
from Mortgage News Daily http://ift.tt/1OJyAW6
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