Consumer Price Index (CPI)

November 17th, 2016

End of day Commentary: Bonds had a rough day – but they still held above support at the $103.0 area a level it has not closed beneath this year – which is the only silver lining in what was otherwise a tough trading session. At the same time in the Treasury Market, the 10-Year yield is right at resistance at the 2.30% level.

 

Despite the nearby support - this afternoon’s selloff, which gained steam throughout the day and into the close is a concern. You may wish consider locking due to volatility and renewed selling momentum.

 

Typical in Bond market selloffs, and we have seen our share in the past two decades – there are times when we see some price consolidation and sideways moves, followed by another round of selling. We are not saying that will happen this time, but you never know.

 

At the same time – there will be a pivot point and support level where Bonds bounce higher and as bad as today was, that bounce could be right here at the 103.0 support level. Let’s hope and see if the price volatility can swing back in our favor tomorrow, as a break below 103.0 would be a bad sign.

 

WRAP: MBS pushed lower this afternoon as buyers ducked out early and as Stocks staged a mini rally. Better-than-expected economic data weighed on Bond prices throughout the session. The 3.5% Fannie Mae 30-yr coupon closed lower by 38bp to end sloppy session at 103.16. Stocks were able to grind out some gains led by higher shares in the banking sector. The Dow gained 35.68 points to 18,903.82, the Nasdaq rose 39.39 points to 5,333.97, while the S&P jumped 10.18 points to end at 18,903.82. WTI oil closed down $0.15 to $45.42/barrel. 10-yr T Note yield 2.29%.

Today's Agenda:

Date & Time of ReportReportForEstimateActualPriorImpact
11/17/2016 8:30:00Consumer Price IndexOct0.40%  0.40%0.30%HIGH
 Core Consumrer Price indexOct0.20%  0.10%0.10%HIGH
 Philadelphia Fed indexNov7.0     7.69.7HIGH
 Jobless Claims11/12257K   235K254KModerate
 Building PermitsOct1200K  1229K1225KModerate

 


What Is Going On With Interest Rates?  #wigowir

Below is the news when it happened and the market’s reaction.  For a full view of the day start at the bottom and work your way up. If want to know what just happened start at the top. All Times are Eastern Standard Time.  When the price of Mortgage Backed Securities (MBS) goes down rates go up, and when the price goes up rates come down. Remember in the bond market Bad News is Good News and Good News is Bad news.  

 

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