Last month’s jobs report shattered records, both for the outright level of job creation and for the gap between job growth and forecasts. While today’s job count was even bigger (+4.8 million versus 2.699m last month), it wasn’t as far above the forecast consensus (1.8m gap versus 10.5m last month). But even that doesn’t fully explain why bonds were able to get back to stronger levels a few hours later. Waiting on covid news!
Econ Data / Events
11:30-11:50 AM (ET) – Fed 30yr UMBS Buying
Nonfarm Payrolls 4.8m vs 3.0m f’cast, 2.699m prev
Unemployment rate 11.1 vs 12.3 f’cast, 13.3 prev
Jobless Claims 1.427m vs 1.355m f’cast, 1.482m prev
Market Movement Recap
Bonds broadly unchanged overnight despite mild-mannered rally in stocks. 10yr yields starting the day up 0.3bps at .679 and UMBS 2.0 coupons are up 1 tick (0.03) at 102-10 (102.31)
Most of the losses in Treasuries have been erased with 10s back down to .686 (up 1bp on the day). MBS are still outperforming and are currently at the highs of the day up 3 ticks (.09) at 102-12 (102.375).
MBS Pricing Snapshot
Pricing shown below is delayed, please note the timestamp at the bottom. Real time pricing is available via MBS Live.
102-11 : +0-02
0.6690 : -0.0130
|Pricing as of 7/2/20 3:24PMEST|
Today’s Reprice Alerts and Updates
10:25AM : Majority of AM Weakness Erased
8:39AM : ALERT ISSUED: Bonds Losing Ground Modestly Despite Big Jobs Report Beat
MBS Live Chat Highlights
Charles Eriman : “most of pricing today was unchanged from yesterday. Slight lean toward locking today”
Caroline Roy : “i’m taking off mon-wed, so feeling lock-inclined on new stuff today. probably overly cautious, but three days away from the lock trigger makes me nervous!”
Paul Cook : “it does look that way”
Sam Baugh : “Yah looks like pricing got pulled back already ahead of the long weekend. Lenders that have weekend pricing don’t want to leave the candy store unattended.”
Michael Kirsch : “mbs look likes a scary double peak or continued break out , what a dice roll over this weekend,!”