What Debt Ceiling? Yields Follow NFP Higher

After being utterly bombarded for weeks, newswire feeds at trading terminals are suddenly devoid of debt ceiling headlines.  To be fair, there have been a few mentions of final approval set for this weekend, but markets moved on long ago.  If there was any reaction in longer term rates, it played out by Tuesday night.  Today’s sell-off was all about nonfarm payrolls.  Today’s AM commentary has all of the charts and discussion on that topic.  Today’s recap is just here to let you know bonds continued selling into the afternoon with 5.0 MBS losing almost half a point.

Econ Data / Events

Nonfarm Payrolls

339k vs 190k f’cast, 253k prev

Unemployment Rate

3.7 vs 3.5 f’cast, 3.4 prev

Participation rate 

unchanged at 62.6

Earnings

0.3 vs 0.4 f’cast, 0.5 prev

Market Movement Recap

08:53 AM flat overnight. weaker after jobs data. 10yr up 3.8bps at 3.639.  MBS down roughly a quarter point.

10:36 AM recovery attempt until 9:30am. Weaker since then.  MBS down 3/8ths.  10yr up 6bps at 3.662.

03:35 PM Additional selling into the PM hours and flat since then.  10yr up 9bps at 3.689.  MBS down just over 3/8ths.