Yields Near Recent Lows Heading Into Another Highly Uncertain Weekend

Bonds began the overnight session with a sharp rally due to an attack/fire at a nuclear plant in Ukraine.  As more dire scenarios were ruled out, bonds bounced, but never came close to moving into weaker territory.  Weaker wage growth in the jobs report paved the way for additional gain the AM hours, but the broader focus remained on Ukraine.  The same patterns continued to play out with stocks and bond yields showing extreme correlation (both moving lower today) and oil prices rising.  Despite the small pull-back, 10yr yields remained more than 10bps lower by the 3pm close and MBS were up more than a quarter point.  Lender rate sheets took a big leap back toward recent lows.

Econ Data / Events

  • Fed MBS Buying 10am, 11:30am, 1pm

  • Nonfarm Payrolls..... 678k vs 400k f'cast, 481k prev
    Hourly Earnings .......0.0 vs 0.5 f'cast, 0.6 prev
    Unemployment........ 3.8 vs 3.9 f'cast
    Participation Rate..... 62.3 vs 62.2 prev

Market Movement Recap
09:02 AM

Bonds were moderately stronger overnight as the broader market continues finding its range after Wednesday's big sell-off.  No major impact from jobs numbers (slight gains if anything).  10yr down 7.5bpst at 1.765 and MBS up a quarter point.

10:02 AM

Rally continues picking up steam with 10yr now down 11.2bps at 1.727 and MBS up nearly 3/8ths of a point.  No new news, just momentum and pre-weekend risk-off trading.

11:46 AM

More time, more rally (but some signs that it's leveling off).  10yr down more than 13bps at 1.71% and MBS now up half a point.