Bond markets only managed to hold steady today, and it felt like the worst day of the year.  There are mortgage-specific reasons for that, however, considering that the average rate sheet has now spent 2 days without improving for the first time all year.  And of course, I'll acknowledge that it's much less meaningful to say things like "worst of the year" and/or "all year" when we're not even through the first 2 business weeks yet.

If I wanted to put a more positive spin on this, I would point out that the S&P gained over 30 points today--something that seems like it should have resulted in more bond market weakness than it did.  To be sure, bonds and stocks spent most every minute of the day moving in the same direction.  It's just that when they moved higher, stocks did so at a faster pace.

Tomorrow brings Retail Sales data as the key economic report.  It's fair to wonder if anyone will give a damn considering the absence of damns given for last week's normally important economic data.  Perhaps with the 'earnings recession' being a key theme in equities markets, Retail Sales will be more meaningful than employment data (after all, we already know job creation is solid).  Beyond that, keep in mind that it's the Friday before a 3-day weekend.  Traders will be tuning out early, and volatility could increase as a result.