After starting down sharply yesterday morning, the Fannie Mae mortgage-backed security market improved yesterday afternoon as a result of a declining stock market led coincidentally by Fannie Mae and Freddie Mac stocks which were absolutely battered yesterday on investor fears that they are fundamentally undercapitalized to handle the risk levels inherent in today's mortgage market.  Additionally mortage market jitters were stoked yesterday by Indy Mac's announcement that they would let go of approx 1/2 of their remaining staff and halt new originations.  Indy Mac is primarily an Alt A (non conforming) and Jumbo lender based in California. In today's economic news, May's Pending Home sales were down 4.7% which was more than expected.  We could see continued volatility for the better or for the worse as current events and the stock market drive the markets.