Quick notes today!

Auction was NOT WELL RECEIVED...39 Billion dollars worth of T-notes were auctioned off this afternoon. After the auction: we saw investors pull back from bonds and pricing got worse this afternoon. The 30 year notes are still in the 5.25% range though.

FNMA 4.5% mortgage backed security is trading at $99.75 which ended up being about 6 bps ahead of where it started the day. Major downswings after the auction were mostly recovered by the end of the day.

Durable Goods Orders report came out. This is a report of the "orders received" for certain goods. We get an indication of "spending" or "demand" with this number. The report came in well below expectations though and investors were left feeling like a "recovery" may not be as close on the horizon.

Crude inventories report released today also is showing a dramatic increase in "supply" which eroded pricing today on oil to just under $64/barrel


ONE more auction for the week will happen tomorrow. Watch for the market to react to its reception. We will also see how the feds are spending their money in the mortgage backed securities market to get a feel for where they are trying to drive rates.

Have a great eve!

Chad