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MBS Recap: Bonds Gain With Europe

While oil prices did move lower in the overnight session, and while stock markets followed that move, bond markets were a bit more independent.  Specifically, European bond markets were in control today.  This wasn't due to any major revelation in European financial markets.  Rather, it was simply Europe that had the most volatile day, thereby impacting interdependent bond markets like the US.

To put an exclamation point on the European thesis, domestic bond markets (and stocks for that matter) bounced right as European bond markets closed.  Treasuries and MBS drifted sideways after that, but stayed in positive territory on the day.

See all of the above on the chart below (oil and stocks heading lower before bonds, US 10's finding inspiration in Germany's rally and backing off after the European close):

2015-12-28 friends

This MBS Market Commentary is provided in partnership with MBS Live and provided exclusively to MBS Live Subcribers.