More on the Annaly (NLY) downgrade: Morgan's move is part of a larger theme of preferring hybrid mREITs (those buying non-agency MBS) to agency mREITs. The hybrids should benefit from higher non-agency yields and an improving housing market. Upgraded: Invesco (IVR). Downgraded (other than NLY): American Capital (AGNC) and MFA Financial. Everyone's piling into non-agency paper.