Logical Reaction to Jobs Data, But Why The Mid-Day Bounce?
Fri, Oct 6 2023, 4:33 PM
Nonfarm Payrolls (NFP), the headline component of the big jobs report, crushed even the most bullish forecasts (336k vs 170k median forecast). In a data dependent bond market, it was no surprise to see yields spike significantly and quickly. 10s hit 4.887 at the peak. It was a surprise, however, to see a fairly substantial mid-day recovery that erased more than half of the AM losses. Unfortunately, that recovery is not attributable to any fundamental motivation in the economy or news headlines. Rather, it’s likely a byproduct of trading dynamics often seen on the Friday before a 3 day weekend.
- Nonfarm Payrolls
- 336k vs 170k f’cast, 227k prev (revised up from 187k)
- Unemployment Rate
- 3.8 vs 3.7 f’cast, 3.8 prev
- Earnings
- Participation rate
- Nonfarm Payrolls
08:33 AM
Hit hard after jobs data. 10yr up 11.8bps at 4.837. MBS down 5/8s.
08:52 AM
Here’s that sell-off… 10yr up 15.8bps to 4.877. MBS down 3/4
11:03 AM
Decent little bounce. MBS down “only” half a point. 10yr up 9bps at 4.809.
02:35 PM
Bounce back got more “decent” and has been flat all afternoon. MBS down only a quarter point. 10yr up 5.9bps at 4.778
Download our mobile app to get alerts for MBS Commentary and streaming MBS and Treasury prices.
Credit: Source link
