Thursday Curse Broken. NFP Friday

Thursdays have been almost universally bad in 2021--a point that was driven home when last week's example looked like it had a chance to break the trend.  We didn't expect much this time around and are thus walking away pleasantly surprised.  There were no obvious market movers driving the gains (in fact, if anything, all-time highs in stocks and the best ISM Manufacturing report since 1983 argue the opposite), which could be a good thing as it speaks to the potential for an underlying shift in momentum.  Unfortunately, it could also speak to a paring of trading positions ahead of a half-day where liquidity is expected to be more of a challenge.  As such, when it comes to confirming today's apparently good vibes, the jury is out until early next week.  In the meantime, Friday's jobs report could  set the stage for volatility early in the trading day.

Econ Data / Events

  • Fed MBS Buying 10am, 1130am, 1pm

  • Jobless Claims 719k vs 680k f'cast, 658k prev
    Continued Claims 3.794m vs 3.775m f'cast

  • ISM Manufacturing 64.7 vs 61.3 f'cast, 60.8 prev
    Highest since 1983
    Prices fell slightly

Market Movement Recap
08:23 AM

Bonds were stronger overnight with steady improvement during Asian hours and more of a back-and-forth move during European hours.  Specifics are in short supply, so we'll cross our fingers and hope it's the product of friendlier "new month" trading.  MBS are up just over an eighth and 10yr yields are down 4bps to 1.705.

11:03 AM

Paradoxically stronger after the best ISM report since 1983 (granted, that might never have been possible without covid creating a couple of the worst ISM reports ever last year).  10yr now down more than 6bps to 1.68%.  MBS are up a quarter point.  Stocks gaining as well (at all-time highs in S&P).

03:07 PM

Very stead at stronger levels.  Yields hit their lows at the EU close (noon ET) and have been sideways since then.  10yr Treasuries still down roughly 6bps at 1.68%.  2.5 UMBS still up an eighth.