There are times when the bond market seems not to care too terribly much what the ADP Employment report is saying. There are other times when ADP has a surprisingly big impact. Relative to the size of today's beat, we arguably saw one of the surprisingly big reactions today. It's not that the move was huge, but rather, that a beat of 143k vs 120k f'cast isn't really worth trading one way or the other normally. It speaks to a market that's on edge about a potentially reassuring NFP on Friday. The default expectation is for more and more labor market slack to be showing up. If it doesn't, bonds are vulnerable to more selling. If it does, the lower boundaries of the recent rate ranges are already well established by the pre-Fed trade.
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- ADP Employment
- 143k vs 120k f'cast, 103k prev
- ADP Employment
Weaker overnight and after ADP. MBS down an eighth and 10yr up 5.4bps at 3.787
Bouncing back somewhat. MBS down 3 ticks (.09) and 10yr up 5.9bps at 3.792 (previously as high as 3.817)
MBS nearly back to unchanged, down only 1 tick (0.03). 10yr still up 4.3bps at 3.776
Friendly bounce has run its course. MBS down 3 ticks (.09). 10yr up 5.3bps at 3.786
MBS Market Alerts
