No major reaction to jobless claims data. Modestly stronger overnight with 10yr down 2.1bps at 4.152 and MBS up 3 ticks (0.09).
Best levels of the morning with MBS up an eighth and 10yr down 2.3bps at 4.15
Mini-snowball rally with help from stock losses. 10yr down 5.2bps at 4.121 and MBS up 7 ticks (.22)
30yr bond auction 4.75 vs 4.771 expectations. Bid to cover 2.66 vs 2.36 avg (higher is better).
10yr yields down 6.1bps to new lows of 4.113. MBS up 8 ticks still.
When the jobs report makes a big statement, bonds are more likely to exhibit elevated momentum and volatility in the following days. In more than a few past examples, a big jobs report can set the tone for the entire month--all the way until the next jobs report comes out. Perhaps it's the delayed release of yesterday's report and the resulting juxtaposition with tomorrow's CPI (also a relevant market mover), but bonds have immediately returned to the sort of sideways, uneventful trading seen on your average, boring trading day. In today's defense, it is fairly average. And the results from this morning's data (jobless claims at 227k vs 222k f'cast, 232k prev) are arguably boring.