Mortgage backed securities (MBS) prices are higher (rates lower) in quiet trading as stocks indexes fell and the Fed prepares its first purchase of U.S. debt this week to combat the recession and bring down consumer borrowing costs.

Stocks declined as apprehension over U.S. stress tests has sparked a risk-reduction mood across the board, benefiting fixed income assets like MBS. Regulators conducting the the stress tests on the 19 largest U.S. banks are increasingly focusing on the quality of loans they made after finding wide variations in underwriting standards. After three straight weeks of improvement, consumers eased off last week as retail sales were soft, largely a reflection of this year's Easter shift into April.

No major economic data is scheduled for today, but there is Fed predident Hoenig testifying before a joint economic congressional committee and Treasury chief Geithner speaking to an oversight panel regarding not needing additional bailout funds. Watch the stock market and news headlines for any guidance.