It proved to be an incredibly straightforward day for the bond market. Trading levels were roughly unchanged in early trading. Friendly Fed comments provided a modest boost, but it was the JOLTS data that clearly set the tone. With job openings hitting the lowest levels since late 2020, traders were quick to hit the buy button. Keep in mind, this is July data whereas Friday's jobs report will be August data. Nonetheless, it was an extra measure of labor market weakness that helped confirm last month's lackluster jobs report. If Thursday's data is similarly downbeat, we could see more of a pre-NFP lead-off with yields challenging the recent range floor.
Rallying after JOLTS data. 10yr down 2.8bps at 4.231. MBS up 2 ticks (.06).
11:39 AM
Holding post-JOLTS gains. MBS up 6 ticks (.19) and 10yr down 4.3bps at 4.216
04:13 PM
Heading out just off the strongest levels with MBS up an eighth and 10yr yields down 4bps at 4.22
Lock / Float Considerations
Any day with rates at longer-term lows (such as Wednesday) is a compelling lock opportunity for risk-averse clients. Friday's jobs report naturally remains the week's biggest source of potential volatility, but Thursday's combo of ADP employment and ISM Non-Manufacturing is a somewhat close second.
