MBS RECAP: Big Rally in Bonds as Concerns Over Economic Cycle Grow
Posted To: MBS Commentary
Bonds rallied in a big way today with intraday lows of 2.885% in 10yr yields. There was also a prominent sell-off in stocks, begging the conclusion that this was a classic "stock lever" move. But that's not exactly right, and it's easy to see why. To be fair to stocks, they are still somewhat involved in the other series of events that precipitated this rally in bonds. When they topped out on Monday morning, it was at levels just below the last major top (itself just below the previous top). Taken together, it looks like stocks are having a very tough time bouncing back after the heavy losses of the past few months. Combine the stock hesitation with Fed speakers who are increasingly calling economic momentum into question and its enough for financial markets to start guarding...(
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