The Smart Team of NOVA® Home Loans

MBS RECAP: Risk-On/Off Trade Takes a Step in Bonds' Direction

Posted To: MBS Commentary

Today's bond market rally masqueraded as a " tradeflow move" surrounding the NYSE Open. We know that ETF trading has been increasingly important for bonds over the past year, and we can often see this in the form of sharper movement surrounding the 9:30am time frame. At first glance, that seemed to be the only game in town this morning. While tradeflows were generally favoring bonds at the expense of stocks, the biggest surges in volume lined up with specific headlines concerning North Korea's nuclear threats. Shortly after the NYSE open, a newswire hit suggesting that North Korea vowed to "wipe out" South Korea and the U.S. with a preemptive nuclear strike. This is nothing new from North Korea, and as such, it didn't elicit an extreme response from markets….(read more)

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Source: Mortgage News Daily

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