Rate Recovery Stumbles, But Jury Still Out
As we said in the run up to today’s trading session, we need to see the first several days of April before passing any judgment on potential trend shifts in the bond market. To be sure, the moderate losses make things a bit less hopeful, but the point is that the jury is still out. After all, even after the losses, this was still the first winning week for bonds/rates since they began spiking at their quickest pace in decades at the beginning of March. As discussed in today’s video, these sorts of green weeks can hold plenty of promise for what lies ahead.
Econ Data / Events
Fed MBS Buying 10am, 11:30am, 1pm
Nonfarm Payrolls………431 vs 490 f’cast, 750 prev Wages …………………+0.4 vs +0.4 f’cast, 0.1 prev Unemployment ……….3.6 vs 3.7 (despite a 0.1 uptick in participation rate)
Market Movement Recap
08:48 AM Much weaker overnight and little-changed after a very decent jobs report. 10yr up 6.6bps at 2.413 and MBS down about 3/8ths.
12:14 PM Decent bounce in the 11am hour after losses accelerated into the 10am hour. MBS were down 5/8ths of a point at their worst levels, but are now down only 10 ticks (.31). 10yr yields were as high as 2.456, but are back down to 2.378–up only 3.3bps on the day.
01:56 PM Mid-day gains leveling off with 10yr up only 2bps on the day at 2.366. MBS down roughly a quarter point.