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

08:18 AM

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)

10:25 AM

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.

MBS

UMBS 2.0

102-11 : +0-02

Treasuries

10 YR

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,!”


By Matthew Graham , dated 2020-07-02 15:26:25

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Courtesy of Mortgage News Daily

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