Thursday's Rally Sets Up For a Very Interesting Friday
Thu, Oct 1 2026, 4:46 PM
MBS Recap
Thursday's Rally Sets Up For a Very Interesting Friday
MBS Recap Matthew Graham | 4:44 PM
Thursday's Rally Sets Up For a Very Interesting Friday
Of course we had to have a big, interesting move in the bond market on the day before an economic report also famous for causing big, interesting moves. On such occasions, if Friday delivers on "interesting" it will either negate today's bullishness or add to it in a way that makes today retroactively look like an obvious near-term top in rates. There's no way to know enough about today's rally to conclude that--let alone the unknowable results of the jobs report and the ensuing reaction. All we know: today was a win. If more wins follow, we can talk more about bigger picture supportive ceilings.
Another round of 8:20am selling erases small overnight gains. 10yr up 1.6bps at 5.303 and MBS up 3 ticks (.09).
01:05 PM
Big intraday reversal (in a good way). European credit spreads could be a factor as well as short-covering ahead of jobs report and new-month trading. MBS up 3/8ths and 10yr down 7bps at 5.218
Lock / Float Considerations
10/1/26 - Thursday's rally is the sort of thing that starts the clock on the game titled "is this a bounce?" In insolation, it's just one of those random recoveries amidst a sea of red. Too risky to treat it as a sign of a shift on the eve of the jobs report, even though a weak jobs report could be capable of confirming a near-term top in rates. (NOTE: that's a BIG "if," and it's not even a 50/50 chance... more like a 15% chance. Reasons are discussed in today's video).
