Mortgages experienced overall better buying in normal-to-above-normal volume in the first half of last week. Contributing to this on Monday and Tuesday was a lack of data and big headline news that led to intraday backups in yields and some easing in volatility.

Wednesday, however, saw a return of the flight to quality bid following a weaker-than-expected existing home sales report, along with other negative news related to housing, subprime and credit woes. Still, mortgages were holding their ground, even as fast money selling began to pick up around midday.

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