Nothing has changed from the Mid-Day Commentary, as MBS continue bouncing along the same lows that offered support earlier this morning. Treasuries have also been contained by their weakest levels of the day. Neither has sold off in any extreme way–indeed MBS are only down 4/32nds–but the losses could still end up being important.
Reason being: today’s weakness potentially markets a turning point similar to several other examples in 2014 where rates have traversed their narrow range, bounced, and headed back in the other direction. We’ll know more about whether or not that bounce is materializing tomorrow, but for today, we have extended runs in one direction coming to an end in both stocks and bonds.