NEW YORK, July 28 (UPI) -- Failing support for United States mortgage companies Fannie May and Freddie Mac resulted in the firms' publicly traded debt falling Monday.
The Wall Street Journal said the selling increased after unconfirmed reports European central banks were selling the agencies' debt securities from their massive reserve holdings.
The Journal said Fannie Mae and Freddie Mac debt fell against comparable Treasury Department securities as traders and investors perceived increased risk in holding the mortgage agencies' debt.
The securities' yields, which move inversely to the price of the securities, increased between 0.03 percentage points and 0.05 percentage points.
J.P. Morgan said the yield on 10-year Fannie Mae and Freddie Mac notes increased by about 0.05 percentage points to trade at around 0.49 percentage points over the 10-year Treasury note. That 0.5 percentage-point spread compares with a spread of about 0.26 percentage point early last month. The yield on debt securities moves in the opposite direction of the securities' price.
