Two-way flows were seen last week, with some profit taking following the previous week's strong performance by money managers, hedge funds and fast money. At the same time, insurance companies remained strong buyers. The big news in the MBS market was the collapse of the FNMA 6 roll, pushing spreads wider, and impacting strategies benchmarked to that coupon. Overseas buying activity also dried up last week.
Originator selling was slightly higher than its $1 billion daily average as Tuesday saw $2 billion in supply. Over the week ending Nov. 10, spreads on 30-year 4.5s through 6s tightened four basis points on average, while 15-year 4s and 4.5s were five basis points tighter.