Stock Market Weakness To The Rescue

Last Friday tied August 11th as the worst day of since early June.  It was something the bond market clearly felt needed to happen (weaker stocks were little help).  The day before, however, stock selling definitely helped bonds extend their week-long rally.  Now today, we're seeing bonds finding comfort in the same misfortune. 

Econ Data / Events

  • 20min of Fed 30yr UMBS Buying 10am, 1130am (M-F) and 1pm (T-Th)

  • Nonfarm Payrolls 1.371m vs 1.4m f'cast, 1.734m prev

  • Unemployment Rate 8.4 vs 9.8 f'cast, 10.2 prev

  • Participation Rate 61.7 vs 61.4 prev

Market Movement Recap
08:20 AM

Bonds were fairly flat to start the overnight session, but gained ground in concert with another big stock sell-off.  10yr yields are down 4.5bps at .676 and 2.0 UMBS are starting the day up an eighth of a point at 103-07 (103.22).

01:06 PM

Still in stronger territory, but bond yields are rising in concert with a bounce in stocks.  3yr Treasury auction didn't help.  MBS down an eighth from highs.  10yr yields up roughly 2bps from lows.

03:43 PM

Persistent, modest weakness leaving bonds at their worst levels of the day, but still in stronger territory versus Friday's close.  10yr down 3.5bps at .689.  2.0 UMBS up 3 ticks (0.09) at 103-06 (103.19).