Orderly Move to Highest Yields in 8 Months

Bonds reacted logically to this morning’s econ data at 10am.  ISM Services’ inflation component was one of the worst offenders, but higher job openings didn’t help.  The spike in yields was instantaneous but fairly well contained.  Bonds managed to drift sideways for the entire session after that with no discernible reaction to the 10yr Treasury auction (not a surprise considering it was very close to expected levels).  All told, yields inched up to the highest since April 2024, but in a very orderly way. 

Econ Data / Events

Job Openings

8.098m vs 7.7m f’cast, 7.839m f’cast

ISM Services

54.1 vs 53.3 f’cast, 52.1 prev

ISM Services Prices

64.4 vs 57.5 f’cast, 58.2 prev

Market Movement Recap

10:17 AM Just slightly weaker overnight with additional selling after ISM data.  MBS down 6 ticks (.19) and 10yr up 4.6bps at 4.678

01:04 PM No major reaction to ho-hum Treasury auction.  10yr up 4.3bps at 4.676 and MBS down just over an eighth.

04:11 PM Sideways since 10am, essentially, with MBS down 6 ticks (.19) and 10yr up 5.9bps at 4.691