MBS Day Ahead: Bonds Hoping For More Political Drama

Posted To: MBS Commentary

Last week was characterized by one big day of volume and volatility surrounding the apparently scandalous and sensational political headlines. By now, you’ve either come across the news in question (regarding Trump, Comey, Flynn, Chaffetz, etc.) or are determined enough to avoid coming across political news that I won’t ruin your streak of good luck. Besides, the only important development for our purposes is the market reaction, the potential for additional market movement, and the consideration of risks to that movement. In last week’s case, the main thrust of movement accompanied the day where the scandalous/sensational news peaked (Wednesday). We might have seen more of a reaction on Tuesday, but the news broke just after domestic markets closed. As we discussed last week, markets…(read more)

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