What happened yesterday? Mortgage backed securities (MBS) lost -13 basis points (BPS) from Monday's close which caused 30 year fixed rates to move slightly higher.

Our benchmark FNMA 3.50 December coupon pulled back from their early gains and treaded water above our floor of support for the majority of our trading session.

The Economic Optimism Survey (43.1 vs est of 43.2) had no impact pricing/rates.

MBS had an early bounce off of our support level as the yield on the 10 year Treasury note rebounded for the first time in a week before the Federal Reserve began the first of two purchases. The central bank is scheduled to buy today as much as $1 billion in securities due from November 2024 to February 2031 and as much as $4 billion in debt maturing between September 2019 and November 2020.

Our benchmark FNMA 3.50 December coupon pulled back from their early gains and treaded water above our floor of support for the majority of our trading session.

The Economic Optimism Survey (43.1 vs est of 43.2) had no impact pricing/rates.

MBS pulled back from their highs on much stronger than expected U.S. Auto Sales (16.40 million units on an annualized basis vs. estimates of 15.70 million units. Obviously, if you are selling more cars, you need build them, order parts, hire people...yada yada. So this better than expected news drove down MBS pricing.