The stakes are high for the rest of this week as far as bond markets are concerned.  The anxiety is obvious.  Is this the turning point where we bounce off periodic lows and head higher?  Even if we're only concerned about the next few weeks, that's all the time it takes to be a very real issue for current pipelines.

As we discussed this morning, today was to be an intermission of sorts ahead of tomorrow's NFP, but one that could still offer clues as to the underlying momentum.  That momentum looked biased toward further weakness out of the gate this morning as Jobless Claims data didn't suggest any reversals and Q2 employment cost data allayed some fears about wage pressure (hat tip to MBS Live cornerstone Andy Horowitz for pointing that out this morning).

Soon after the first wave of selling, bond markets dug in and began fighting back toward unchanged levels.  A much weaker-than-expected Chicago PMI report only helped modestly at 9:45am, but at least it didn't hurt. 

Doing most for the cause has been 'month-end' tradeflows as certain market participants are forced to buy bonds to bring portfolios in line with benchmark indices.  We're also seeing evidence of "asset allocation" trading where money managers are reducing holdings of stocks and adding to bonds. 

On a final note, a late-day bond rally in Europe is adding yet enough source of strength for domestic bond markets.  All of the above has been just enough to get Treasuries and MBS back in positive territory on the day.  With lenders having priced defensively out of the gate, many of them have already repriced for the better.

MBS Pricing Snapshot
Pricing shown below is delayed, please note the timestamp at the bottom. Real time pricing is available via MBS Live.
FNMA 3.0
98-01 : -0-01
FNMA 3.5
101-29 : +0-00
FNMA 4.0
105-05 : +0-01
2 YR
0.5354 : -0.0276
10 YR
2.5469 : -0.0051
30 YR
3.3003 : -0.0097
Pricing as of 7/31/14 12:34PMEST

Morning Reprice Alerts and Updates
A recap of Alerts and Updates provided to MBS Live subscribers.
11:36AM  :  MBS Back into Positive Territory; Broader Bond Market Still on Fence
9:56AM  :  Chicago PMI Much Weaker Than Expected; Bond Markets Barely Budge
8:36AM  :  ALERT ISSUED: No Help From Jobless Claims, Bond Markets Consider a Melt-Down

Live Chat Featured Comments
A recap of featured comments from the Live Discussion on the MBS Live Dashboard.
Michael Dormer  :  "MG: The new layout / options on this site are a huge upgrade on an already great service. It's the topic of my sales meeting next Monday. Great stuff."
Victor Burek  :  "let us know if you have any questions...tons of great info on this site, and tons of knowledgeable people who will gladly help"
Victor Burek  :  "welcome to the site Ryan"
ryan bier  :  "MG: take my money, forget the trial period. THIS is exactly what I have been looking for! Thank you."
Chris Hooker  :  "Now we just need a miss on NFP and ISM tomorrow and maybe we can crawl back out of this hole a bit"
Andy Pada, Jr.  :  "is this enough of a tackle to stop the GDP running game?"
Matthew Graham  :  "you can usually guess based on what the market is doing at that time."
Matthew Graham  :  "some traders get it at 9:42"
Brent Borcherding  :  "Whisper PMI?"
Matthew Graham  :  "looks like Chi PMI is gonna miss"
Matthew Graham  :  "RTRS - US JOBLESS CLAIMS ROSE TO 302,000 JULY 26 WEEK (CONSENSUS 301,000) FROM 279,000 PRIOR WEEK (PREVIOUS 284,000)"
John Rodgers  :  "MG, you rock, keep up the updates. Saved me thousands on my locks and help me keep my borrower informed!!"