Bond markets continued to do the exact same thing they've been doing all year: follow stocks/oil. Today was the first day of the year that stocks had 2 consecutive winning days. Yesterday's winning day was a minor inconvenience for bonds, but today's move in stocks was much bigger. As such, it's no surprise to see bonds taking a bit of a bigger hit.
10yr yields came into the domestic session over 2.07 and were as high as 2.089 by mid-morning. After European markets closed, bonds were able to gain some traction and end the day with 10yr yields only 2.9bps higher. Fannie 3.0s were only 3 ticks weaker by the close, but lender rate sheets belied the gentleness of the secondary market's adjustments (i.e. rate sheets got hit a bit harder than MBS prices would have suggested).