WOW. What a roller coaster on Wall street. Markets experienced extreme volatility once again today especially after the Fed announced its statement at 2:15pm ET. The Fed did not say that it would add any additional stimulus to the economy but Stocks bounced back after the horrific sell-off in recent days. Mortgage Bonds also rose today – our new focus is the 3.5% coupon rising 131bp to end at 101.22. The Monthly Bond Rollover will occur after the close of trading and will be reflected tomorrow. The Dow surged 429.92 to 11,239.77, the S&P 500 jumped 53.07 at 1,172.53 while the Nasdaq soared 124.83 to 2,482.52. Oil in after hours trading was $82.14/barrel down $2. There is no economic data tomorrow. The Treasury will sell $24B 10-yr notes tomorrow.
Yesterday the 4% coupon fell 100bp with the absence of buyers, but the opposite happened today as buyers came out in droves and pushed the coupon up 119bp to 98.94! Bargain hunting and a strong performance by the 7-yr note auction were the catalysts behind the move. Stocks had another dull session with low volumes in the absence of any economic news. The Dow rose 9.84 to 11,585.38, the S&P 500 gained a mere 1.27 to 1,259.78 while the Nasdaq finished at 2,666.93 up 4.05. Crude oil fell 37 cents to $91.12/barrel. Tomorrow’s economic data includes Initial Claims, Pending Home Sales and Chicago PMI.